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- This topic has 5 replies, 4 voices, and was last updated 6 years ago by Cath.
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- September 24, 2017 at 2:18 pm #408501AnonymousInactive
- Topics: 2
- Replies: 0
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XYZ plc, a paint manufacturer, operates a process costing system. The following details related to process 2 for the month of October:
Opening work in progress
5000 litres fully complete as to transfers from process 1 and 40% complete as to labour and overhead, valued at £60000Transfer from process 1
65000 litres valued at cost of £578500Direct labour
£101400Variable overhead
£80000Fixed overhead
£40000Normal loss
5% of volume transferred from process 1,scrap value £2.00 per litreActual output
30000 litres of paint X (a joint product)
25000 litres of paint Y (a joint product)
7000 litres of by-product ZClosing work in progress
6000 litres fully complete as to transfers from process 1 and 60% complete as to labour and overhead.The final selling price of products X, Y and Z are:
Paint X £15.00 per litre
Paint Y £18.00 per litre
Product Z £4.00 per litreThere are no further processing costs associated with either paint X or the by-product, but paint Y requires further processing at a cost of £1.50 per litre.
All three products incur packaging costs of £0.50 per litre before they can be sold.
Required:(a)Prepare the process 2 account for the month of October, apportioning the common costs between the joint products, based upon their values at the point of separation.
(b)Prepare the abnormal loss/gain account, showing clearly the amount to be transferred to the profit and loss account.
I spared no pains to do this question but I still couldn‘t solve it. Can you tell me how to solve Part a & b ? Many thanks!
September 25, 2017 at 9:57 am #408579Hi – you’ll be pleased to know that process costing isn’t on the CIMA P1 syllabus so not sure where you’ve had this question from but there is no need to worry about it 🙂
Many Thanks
CathMay 9, 2018 at 7:22 pm #450932please i need your assistant on this question
JK has budgeted sales for next year of 24,000 units and inventory levels are expected
to remain constant throughout the year. Each unit produced will require 3 labour hours
and the budgeted labour rate will be $15 per hour. It is estimated that 10% of units
produced will be wasted.
It is expected that 15% of the total hours worked will be paid at overtime rates. 10% of
the total hours will be paid at the basic rate plus an overtime premium of 50% of the
basic rate. 5% of the total hours will be paid at the basic rate plus an overtime premium
of 100% of the basic rate.
The labour cost budget for next year is:May 10, 2018 at 9:51 pm #451149Hi there.
When students have a query on this forum – sometimes its regarding a question – other times regarding a theory or something in the notes or videos.
Generally, when querying a question then the student gives me the answer and workings and from there they explain specifically what part of the answer or workings they dont follow.
If I work this out and give you an outright answer in $ – how does that help your learning process.?
Please tell me the model answer and let me know which part you cant calculate.
Many ThanksMay 20, 2018 at 11:38 am #452966Hi,
Have you got the answer olawaleoke? My email reads as alfkas@hotmail.com, if you be so kind to forwardThxs
May 20, 2018 at 4:44 pm #453005Im afraid I said no to answering Olawaleoke – this is not a CIMA question and if all you need is the answer (not an explanation) then surely this is provided in your text book?
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