Silver Spoon Incorporated Is a Manufacturer of Kitchen Utensils Beginning Work in Process Was 25% Complete as to Conversion

question 34

Essay

Silver Spoon Incorporated is a manufacturer of kitchen utensils.It produces all of its products in one department.The information for the current month is as follows:
$\begin{array}{lr}\text { Beginuing work in process } & 40,000 \text { units } \\\text { Units started } & 52,000 \text { units } \\\text { Units completed } & 73,000 \text { units } \\\text { Ending work in process } & 16,000 \text { units } \\\text { Spoilage } & 3,000 \text { units }\\\\\text { Beginning work-in-process direct materials } & \$ 30,000 \\\text { Beginning work-in-process conversion } & \$ 8,000 \\\text { Direct materials added during month } & \$ 126,400 \\\text { Direct manufacturing labor during month } & \$ 60,480\end{array}$ Beginning work in process was 25% complete as to conversion.Direct materials are added at the beginning of the process.Factory overhead is applied at a rate equal to 40% of direct manufacturing labor.Ending work in process was 60% complete.All spoilage is normal and is detected at the end of the process.
Required:
Prepare a production cost worksheet if spoilage is recognized and the weighted-average method is used.

---

Definitions:

Lean Accounting

An accounting system characterized by fewer transactions, combined accounts, nonfinancial performance measures, and direct tracing of overhead.

Conversion Costs Account

An accounting term that combines direct labor and overhead costs associated with transforming raw materials into finished goods.

Direct Labor

Labor costs that can be directly traced to the production of specific goods or services, unlike indirect labor costs which cannot be directly linked to production.

Long Lead Times

Extended periods required to manufacture a product or complete a process, often causing delays in production or output.