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MA

Process Costing – Work-in-progress (part 1) - ACCA Management Accounting (MA)

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33 Comments

  1. Suyeon
    This chapter is Joint Products instead of Work In Process now, where can I find the new lecture videos?
  2. John MoffatTutor
    If you are taking the exam after September 2023 then work in progress is removed from the syllabus.

    We made a mistake in updating the index to the lectures - it you check now it should be OK.
    https://opentuition.com/acca/ma/acca-management-accounting-ma-lectures/
  3. Chisala
    Sorry to ask question that may seem blatantly obvious but does that mean theyll be no calculations whatsoever involving Work in Progress? . I’ll be writing MA in 2024
  4. anna
    can I have the notes for the work in progress
    your videos are very helpful but the lecture for work in progress isn't available
    I have a university examination which includes the topic
  5. John MoffatTutor
    Sorry but our lectures are for those people studying for the ACCA exams.
  6. John MoffatTutor
    That is correct :-)
  7. Chisala
    Thanks for the reply, i enjoy your lectures too. Happy new year
  8. John MoffatTutor
    You are welcome, and Happy New Year to you also :-)
  9. Muhammed Saleem
    Hiii Sir,
    When we are valuing work in progress, we can multiply the equivalent units into cost per unit, Can't we??
    If we try to example 1,
    Labour = 200 x ($3x60%) = $360
    instead of this,
    120 x $3 = $360
    Same answer is coming.
    So, can we use both methods?
  10. John MoffatTutor
    Yes, of course
  11. Muhammed Saleem
    Thank u sir...
  12. John MoffatTutor
    You are welcome.
  13. Mannan
    Hi sir! if we are calculating the cost per unit of every process every month, the cost per unit of each process will keep changing every month because every month there will be different costs incurred for materials, labour, overheads so there will be different value of the inventory each month(different cost per unit in the inventory each month). how will that be useful?
  14. John MoffatTutor
    If costs are increasing them maybe the company will want to increase their prices. As with all management accounting, the company does whatever it the most useful for them.
  15. Storm
    Thank you very much sir, this was absolutely helpful
  16. John MoffatTutor
    You are welcome :-)
  17. Anil
    Hello John, Firstly thank you for these amazing training video lectures which are very simple and easy to follow. I am not from accounts but your videos are resourceful and are encouraging me to complete chapter by chapter. I thought WIP (this section) is too complicated, but your methodology was just awesome.
  18. John MoffatTutor
    Thank you for your comment :-)
  19. Sneha
    Sir I just want to thank you for this lecture on process costing

    It really helps me since I keep forgetting this chapter a lot of times and this lecture is there to remind me how to do it again
    Also i want to thank your notes it really helps me in this chapter
  20. John MoffatTutor
    Thank you for your comment :-)
  21. Asif
    Very well explained - equivalent units. Grateful once again !
  22. John MoffatTutor
    Thank you for your comment :-)
  23. Denis
    Sir, thank you for your lessons.

    Just 1 question regarding the T process,
    the output (finished goods) of 800 units = cost $9600 when we credit it to put those finished goods out of production process, which is the double-entry to do before we sell it (debit cash/receivable and credit sale).

    Thank you in advance for your time and patience :)
  24. John MoffatTutor
    We debit the finished goods account.
  25. Denis
    But, after we have to debit it, we want to sell these finished goods, so how is done the double-entry, I mean the connection between credit these finished good since is output but meanwhile in the same time we should do the double-entry of credit sale and debit cash/reveivable.

    I guess something is missing me.

    Thank you in advance, sir.
  26. John MoffatTutor
    We credit the finished goods account and debit the Statement of Profit and Loss with the cost of the goods sold.

    However you are not examined on all the double entries in Paper MA.
  27. Denis
    Thank you again, sir, for your fast reply which was very helpful to me.
  28. John MoffatTutor
    You are welcome :-)
  29. vimarlen
    Hello Sir, i have a question, can we have a question with Abnormal loss or gain merged with Work in progress???
  30. John MoffatTutor
    No - the examiner has said that questions will not examine both in the same question.
  31. fathah2000
    Hello sir, i have a serious doubt about equivalent units. what i have understood about equivalent units is below,
    IF THE WORK DONE IS 100 UNITS AND OUT OF THAT HALF OF THE UNITS WERE FINISHED AND ANOTHER HALF WERE INCOMPLETE.THE COMPLETED 50 UNITS ARE CALLED EQUIVALENT UNITS.
    By applying this concept in questions, i cannot arrive to a correct answer. i would like to know that my conceptual knowledge is right or wrong.

    Thankyou.
  32. claycall
    Hi fathah2000 you have to work it out according to material labor and o'heads

    lets assume we are a company and we are making chairs and we have 200 chairs in wip. The material of those chairs is 100% ready so we don't need to calculate the Equivalent units. When it comes to labor they are 60% so we calculate the EU which is 60% of 200 = 120 .... its like having 120 chairs 100% ready from labor. Same for the o'heads.
  33. John MoffatTutor
    I do make this point in the lectures - that materials are always immediately 100% complete unless specifically told otherwise. Have you watched the other parts of this series of lectures?

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