Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for March and June 2025 exams.
Get your discount code >>

F2 Chapter 12 Questions

VIVA

Reader Interactions

Comments

  1. Hi Sir

    Could I please ask you questions related to question 5? I apologies in advance, I really cannot find a clear way to ask these questions!

    Is it always the case: if you’re told what the value of the input cost is for an incomplete unit (like the $2.50 for labour and overheads) that you’re then not required to calculate equivalent unit values and you can just use the figure you’re given to add to the other input costs per unit? Is this a reliable method to use for questions of a similar nature (i,.e. in process costing questions where you are not given the degree of completion of the work-in-progress)?

    And/or is the case that when the overall percentage of completion achieved with the closing work in progress isn’t given, you would be unable to calculate equivalent units production, which prevent you from calculating the equivalent costs per unit to derive the value of the closing work-in-progress figure?

    Ultimately, if you’re not given the % of completion of work-in-progress will you need to be told what the value of the input costs are for the incomplete units in order to be able to value the closing work-in-progress?

    Thank you

  3. Good day sir,
    Question 4.
    Value of closing wip = (3000x$3.40)+(3000×30%x$14.10) = $22,890
    I understand that 3000 units is ending wip which 30% completed, but why we still need to multiply by 30% again since when we calculate the conversion cost we already multiply by 30%?

    Cloud you further explain to me?

    • The conversion cost calculated is the cost per finished unit. If the WIP is only 30% finished then we bring in 30% of the full unit cost.

      I assume that you have watched my free lectures on this before attempting the test?

  4. Hello sir,

    In Q4, in the solution pop up it shows: Material cost = Material / (12000 + Closing Work in Progress). I can’t understand what the 12000 stand for and how do we arrive to it. Could you please explain?

    • 14,000 units were completed but 2,000 of them had already been started (the opening WIP). So only 12,000 of those needed material in this period.

      (Have you watched my free lectures on process costing?)

  5. Hello John,

    In Q4., as per the solution pop up they have shown 193700/(40% of Materials) + 12000 + (30% of Conversion). From where do we arrive at 12000 in this equation, shouldn’t it be 100 % of 14000 i.e 14000 ?

    Regards
    Krishna Singh

    • You should have got a pop-up window when you submitted your answer, showing the workings.

      If they produced 14,000 finished units and also had 3,000 units WIP at the end of the period, then in total they must have been working on 17,000 units.

      At the start of the period they were already working on 2,000 units, and so they must have input an additional 15,000 units in order to be working on a total of 17,000 units.

      • Good day Sir,
        as per the solution pop up they have shown that 51000/ (12000+3000)….i understand that 12000 is in respect of the goods that were started and finished ,how about for the 3000???can you please explain.thanks

      • The other 3,000 are the WIP carried forward, which had been started this period and were fully finished in respect of materials.

        Have you watched my free lectures on this? (Our lectures are a complete free course for Paper F2)

Leave a Reply