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Process Costing

KKyaw11y ago
This is a BPP MCQ. A manufacturer produces Product X from three input raw materials, P, Q and R. There is some loss in the process, usually about 5% of input. Results for the most recent month are as follows. Input 5000kg of P, cost of $15000 2000kg of Q, cost of $8000 1000kg of R, cost of $8000 Output 7500kg of Product X Which one of the following performance measurements is accurate? A) Rate of wastage = 6.7% B) Average cost of input = 4.13 per kg C) Output: input conversion ratio = 6.25% D) Materials yield variance = $1938(A) The correct answer is B. I think this should be average cost of output. Help me, Sir.
John MoffatJohn MoffatTutor11y ago#1
You are correct. Assuming you have typed the question correctly, then it seems as though it is a BPP typing error.
John MoffatJohn MoffatTutor11y ago#2
Maybe one day :-)
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