Dear John, I have one question about inventory. I hope you will find time to check it for me. CIosing WIP invent. 2000 units, 100% complited for material, 40% complited for labour. Equivalent £12 per unit. So, I have for material 2000unit (100%) + labour 800 unit complited = 2800 unit X £12=£33600 value for units complited WIP. Is that correct? Thank you in advance for your help. Regards
You need the equivalent cost per unit for both materials and for labour.
If is is an equivalent cost of $12 per unit for labour, the 33600 is the labour part of the value of the closing WIP. However more information is needed about the material cost to be able to calculate the full value of the WIP.
Only finished units are needed to transfer out from the process a/c to the next process or warehouse. And The remaining will be there for next month. => CR is 9600.
Michael says
Hi sir can I ask what textbook are you using?
John Moffat says
The lectures are using our free Course Notes (if you look just above the lecture, on the right hand side, it says this and gives the link).
Vu says
Dear Sir,
Can I get to know the name of this lecturer?
Thank you.
John Moffat says
Why do you want to know my name? :-))
Vu says
Oh, so that’s you. After I watched the online lectures, I have to admit that I really love your voice. Just so you know. 😀
John Moffat says
Well…..I don’t know what to say :-))
Thanks! 🙂
Jide says
Hello Sir,
Can the cost per unit gotten from the cost and equivalent unit be also referred to cost per equivalent unit?
John Moffat says
Yes 🙂
vinukmathews says
Hi,
Thanks for ur videos. I cant play videos. It is says that cross domine access denied
John Moffat says
Lectures work OK now
oboloben says
Best things in life are indeed free!Thank you so much for a very fine lucture.God bless you.
agnieszka78 says
Dear John,
I have one question about inventory. I hope you will find time to check it for me. CIosing WIP invent. 2000 units, 100% complited for material, 40% complited for labour. Equivalent £12 per unit. So, I have for material 2000unit (100%) + labour 800 unit complited = 2800 unit X £12=£33600 value for units complited WIP. Is that correct? Thank you in advance for your help. Regards
John Moffat says
You need the equivalent cost per unit for both materials and for labour.
If is is an equivalent cost of $12 per unit for labour, the 33600 is the labour part of the value of the closing WIP. However more information is needed about the material cost to be able to calculate the full value of the WIP.
Hema says
How $33,600 could be the labour cost in WIP since the completed material were 100% meanwhile the workmanship were only achieved at rate of 40%?
Is it the total cost for both raw material and workmanship is RM12 for each unit?
John Moffat says
Sorry…..if the equivalent cost of labour is $12 per unit, then the labour element of the WIP should be valued at 2000 x 40% x 12 = $9600.
In addition there is the material cost and since this is 100% complete this would be 2000 x equiv mat cost per unit.
However this information is missing in what agnieszka typed.
aijaz says
Hello,
When the process a/c is balanced i.e. units & $ both, then why we need to bring in the concept of carried forward & brought forward.
John Moffat says
Think about this…….suppose we are working on 1,000 units, but only 800 are finished.
What do you think happens to the other 200?
They are still there in the process and will be finished next month.
That is why we need to carry forward 200 at the end of this month and being forward 200 at the start of next month.
aijaz says
Your immediate clarification was highly appreciated. Thanks…
albertaddy says
how do i download this video?
John Moffat says
Videos can only be watched online. It is the only way that we can keep this website free of charge.
vinukmathews says
Hi,
Where can i find lecture video for make or buy decission?
John Moffat says
There is no lecture on make or buy yet. You will have to look at it in the Course Notes.
hmanjiche says
could never understand better, thanks John, you are the best, my learning has become quite enjoyable
tauraiversatile says
Good explanation, you are super OT! these other institutions of ours do not explain this properly, Well done!
lloyd2313100 says
this was really great …clear explanations
ishtar says
it doesnt play beyond 8 minutes
admin says
@ishtar, if it stops, press play again, it should pick up from where it left
saroeunsang says
Only finished units are needed to transfer out from the process a/c to the next process or warehouse. And The remaining will be there for next month. => CR is 9600.
Am I right lecturer?
John Moffat says
@saroeunsang, Yes – you are correct. The WIP is carried forward to the next period as a balance on the Process account.
Vanna Motilal says
what is the double entry for WIP? Cr wip and debit what?
Vanna Motilal says
@Vanna Motilal, or dr wip and cr what?
John Moffat says
We don’t debit or credit anything – we simply carry forward the balance.
sparkyboo says
Nice lecture.
winnytan says
awesome !!
i like it..
consmilly says
i couldnt open non of lectures on my Microsoft windows Laptop.
but it worked well with apple.
i will check on support as well
gran says
dont play why?
2126212acs says
I was not successful in opening the lecture…any advice?
admin says
visit support page https://opentuition.com/support/