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Questions and Answers
What type of spoilages are considered inherent, usual, and expected by the nature of operations?
What type of spoilages are considered inherent, usual, and expected by the nature of operations?
- Abnormal spoilages
- Extraordinary spoilages
- Normal spoilages (correct)
- Hidden spoilages
Which of the following is a cause justifying the recognition of normal lost units?
Which of the following is a cause justifying the recognition of normal lost units?
- Growth - plants
- Disappearance - electronics
- Expansion - metal
- Shrinkage - cloth (correct)
How is normal loss usually treated in accounting?
How is normal loss usually treated in accounting?
- It is recorded as a liability
- It is considered an asset
- It is included as part of all units finished (correct)
- It is deducted from the total revenue
What principle determines whether normal lost units' cost is absorbed by good units?
What principle determines whether normal lost units' cost is absorbed by good units?
In the FIFO method, what happens to the cost per equivalent unit (EUP) if spoilage is ignored?
In the FIFO method, what happens to the cost per equivalent unit (EUP) if spoilage is ignored?
What is the consequence of ignoring spoilage in the weighted average method?
What is the consequence of ignoring spoilage in the weighted average method?
What are the types of production losses in a job order cost system?
What are the types of production losses in a job order cost system?
How should a manufacturing firm aim to handle production losses in a job order cost system?
How should a manufacturing firm aim to handle production losses in a job order cost system?
What is an appropriate accounting treatment for scrap with value in a job order cost system?
What is an appropriate accounting treatment for scrap with value in a job order cost system?
How should scrap sales be accounted for in a manufacturing firm?
How should scrap sales be accounted for in a manufacturing firm?
How should a firm track quantities of scrap over time?
How should a firm track quantities of scrap over time?
What is the purpose of analyzing quantities of scrap in a manufacturing firm?
What is the purpose of analyzing quantities of scrap in a manufacturing firm?
What is the main difference in assigning the cost of lost units between goods that have passed the inspection point and those that have not, under the weighted average method?
What is the main difference in assigning the cost of lost units between goods that have passed the inspection point and those that have not, under the weighted average method?
What type of spoilages are considered abnormal?
What type of spoilages are considered abnormal?
How is the cost of lost units determined under FIFO method for goods that have passed the inspection point?
How is the cost of lost units determined under FIFO method for goods that have passed the inspection point?
Which of the following is a cause giving rise to abnormal lost units?
Which of the following is a cause giving rise to abnormal lost units?
In accounting treatment, how are abnormal losses typically treated?
In accounting treatment, how are abnormal losses typically treated?
Under what method would the cost of lost units be assigned only to the good production that was transferred if the ending inventory had not yet passed the inspection point?
Under what method would the cost of lost units be assigned only to the good production that was transferred if the ending inventory had not yet passed the inspection point?
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