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Hi, i have tried for hours this question and i have no clue about it. hope someone can give me some idea on how to do it. Thank you https://oi44.tinypic.com/21ez12c.jpg
The normal loss is 500 (5% x 10000), and since the actual loss is 420 there is an abnormal gain of 80 units.
Also, the actual finished units are 9580.Materials are costed over the units we expect to produce, so the cost is 16445 – 200 (expected proceeds from scrap) = 16245.
The units expected to be finished – actual finished less abnormal gain i.e. 9580 – 80 = 9500 units.
So cost per unit = 16245 / 9500 = $1.71Lab & o/heads: the total cost is 28596, and the equivalent units are 9580 (finished) – 48 (60% x 80 abnormal gain).
So cost per unit is 28596/9532 = $3 per unit.So total cost per finished unit is $4.71
(Do note that you cannot be asked to write up t-accounts in Paper F2).
oops sorry, one more question,
the equivalent units are 9580 (finished) – 48 (60% x 80 abnormal gain).
does that mean the abnormal gain for labour is 48? why is it 60% of 80?
Hi,https://www.cimaglobal.com/Documents/ImportedDocuments/ci_april_04_p19_20.pdf for absorption costing.
fixed overhead capacity, isnt it 110-110 x 2.5
and effiency 105-110 x 2.5
why cant i get Fixed overhead volume variance £125 ? Thanks in advance
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