Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Can anyone please make me understand how ans is 75%?
- This topic has 1 reply, 2 voices, and was last updated 3 years ago by John Moffat.
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- June 11, 2021 at 5:07 pm #624736
A company operates a process in which no losses are incurred. The process account for last month,
when there was no opening work-in-progress, was as follows:
Process account
$ $
Costs arising 624,000 Finished output (10,000 units) 480,000
Closing work-in-progress (4,000 units) 144,000
–––––––– ––––––––
624,000 624,000
–––––––– ––––––––
The closing work in progress was complete to the same degree for all elements of cost.
What was the percentage degree of completion of the closing work-in-progress?
? 12%
? 30%
? 40%
? 75%June 12, 2021 at 7:21 am #624884The cost per unit of the finished output is 480,000/10,000 = $48 per unit.
The cost per units of the closing WIP is 144,000/4,000 = $36 per unit.
Therefore the % completion of the WIP = 36/48 = 75%
Have you watched my free lectures on process costing? The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
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