You are required to prepare the process account and abnormal gain account for a single process for the current period, given the following information:
Opening work in progress of 1,000 units, valued at $1,595 and complete as to:
Materials input from previous process 100%
Materials added 75%
Labour 40%
Overhead 20%
Costs during the period were:
Material input 8,000 units at 94.375c per unit
Material added $3,870
Direct labour $2,640
Overhead $1,980
The number of units scrapped 500 units
Closing work in progress 2,000 units
Complete as to:
Material input 100%
Material added 50%
Labour 40%
Overhead 30%
Normal loss is taken of 10% of production. Scrap value of any loss is 43.75c per unit
Ask the Tutor ACCA MA
Process Costing with work in progress
5y ago#1There is no point in simply typing out a full question and expecting to be provided with a full answer.
You must have an answer in the same book in which you found the question, so ask about whatever it is in the answer that you do not understand and then I will explain.
The examiner has said that losses and WIP will not be examined in the same question (and anyway we need to know at what stage of production losses occur). Also, you cannot be asked to prepare process accounts in Paper MA (although you must be aware of them).
Everything needed for the exam is covered in my free lectures.
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