8

PROCESS COSTING

( COST OF PRODUCTION REPORT)

Q No.1Information given to Goods in process in the Z DEPARTMENT of Aramco company.

Material cost

75,000

Labor cost

53,700

Overhead cost

35,800

Production information:

Units put into process during the month------------------------------------------20,000

Units completed and transferred to Holder department-----------------------16,000

Units in process August 31( 75% complete as to Material and 60%

complete as to labor and overhead)-----------------------------------------------4000

Instruction: Prepare Cost of Production Report for the month of August

Q No.2Information given to Goods in process in the T DEPARTMENT of Pepsi company.

Material cost

250,000

Labor cost

175600

Overhead cost

150,000

Production information:

Units put into process during the month------------------------------------------45,000

Units completed and transferred to M department-----------------------35,000

Units in process August 31( 35% complete as to Material and 40%

complete as to labor and overhead)-----------------------------------------------10,000

Instruction: Prepare Cost of Production Report for the month of September.Q No.3 :PROCESS COSTINGInformation given to Goods in process in the CAP DEPARTMENT of ABC company.

Beginning Inventory

Rs. 15,000

Material cost

75,000

Labor cost

53,700

Overhead cost

35,800

Production information:

Units in process August 1, (80% complete as to Material and 70% complete as to Labour and overhead)-------------------------------------5000 UNITSUnits put into process during the month------------------------------------------20,000

Units completed and transferred to Holder department-----------------------16,000

Units in process August 31( 75% complete as to Material and 60%

complete as to labor and overhead)-----------------------------------------------9000Instruction: Prepare Cost of Production Report for the month of August

Q No.4Information given to Work in process in the A DEPARTMENT of Caltex company.

Beginning Inventory

Rs. 25,000

Material cost

175,000

Labor cost

67500

Overhead cost(120% of Direct labor)

????

Production information:

Units in process September 1, (40% complete as to Material and

60% complete as to Labour and overhead)-------------------------------------7500 UNITS

Units put into process during the month------------------------------------------25,000

Units completed and transferred to Holder department-----------------------30,000

Units in process August 31( 35% complete as to Material and 60%

complete as to labor and overhead)-----------------------------------------------2500Instruction: Prepare Cost of Production Report for the month of September.Q No.5Information given to Goods in process in the B DEPARTMENT of Shell company.

Beginning Inventory

Rs. 325,000

Material cost

865,400

Labor cost

600,000

Overhead cost

500,000

Production information:

Units in process March 1, (20% complete as to Material and

35% complete as to Labour and overhead)-------------------------------125000 UNITS

Units put into process during the month------------------------------------ 320,000

Units completed and transferred to Holder department--------------------375,000

Units in process March 31(25% complete as to Material and 30%

complete as to labor and overhead)-------------------------------------------70,000Instruction: Prepare Cost of Production Report for the month of MarchQ No.6 (units transferred in from preceding department)

Beginning units in process (55% direct material and 15% conversion costs) 135,000 units

Units transferred in during the period 420,000 units

Cost transferred in this period

Rs.588,000

Work-in-process inventory-beginning Rs.472,500

Cost added during this period:

Direct materials

Rs.812,700

Direct labor

676,260

Factory overhead

487,300

Units transferred out to finished goods inventory

430,000

Ending units in process (25% direct materials, 70% conversion cost)------------ 115,000Difference of units is treated as normal loss.

Instruction: Prepare Cost of Production Report for the month of April

Q No.7 ( Weighted Average Method/ FIFO MethodOpening Work-in-process

Material

Rs.1500

Labor

2000

FOH

1000

4500Opening work in process 800 units ( 40% complete as to material and 25% complete as to conversion)

Units started in process 5000

Cost added by the department

Material

Rs.37500Labor

Rs.55000

FOH

Rs.27500

Units completed during the month 4800Units still in process are 60% complete as to material and 40% complete as to conversion.

Required:

1. Prepare Cost of Production Report by Weighted Average Method

2. Prepare Cost of Production Report by FIFO Method

Q No.8The healthy Foods corporation presented following data for the month just ended.

Units

Percentage of completion

MaterialConversion

Work-in-process, Jan.1

20,000 80%

60%

Work-in-process, Jan 30

15000

70%

30%

During the month the company started 120,000 units of material in production.

Required:

Compute Equivalent production units under (1) FIFO Method (2) Weighted average method

Q No.9Energy resources company refines a variety of petrochemical products. The following data are from the firms record.

Work in process Nov.1

2,000,000 gallons

Material

90% complete

Conversion

60% complete

Units started in process during November

950,000 gallons

Work in process, November 30

240,000 gallons

Material

80% complete

Conversion

60% complete

Required:

Compute Equivalent production units under (1) FIFO Method (2) Weighted average method

Q No.10 (units transferred in from preceding department)

Beginning units in process (65% direct material and 70% conversion costs) 135,000 units

Units transferred in during the period 420,000 units

Cost transferred in this period

Rs.588,000

Work-in-process inventory-beginning Rs.472,500

Cost added during this period:

Direct materials

Rs.812,700

Direct labor

676,260

Factory overhead

487,300

Units transferred out to finished goods inventory

430,000

Ending units in process (45% direct materials, 550% conversion cost)---------- 115,000

Difference of units is treated as normal loss.

Instruction: Prepare Cost of Production Report for the month of April

Q No.11

Beginning units in process (85% direct material and 45% conversion costs) 105,000 units

Units transferred in during the period 520,000 units

Cost transferred in this period

Rs.688,000

Work-in-process inventory-beginning Rs.872,500

Cost added during this period:

Direct materials

Rs.412,700

Direct labor

576,260

Factory overhead( 75% of direct labor cost)

-----------

Units transferred out to finished goods inventory

530,000

Ending units in process (90% direct materials, 70% conversion cost)------------ 80,000

Difference of units is treated as normal loss.

Instruction: Prepare Cost of Production Report for the month of April by FIFO method.

Q No.12Beginning units in process (100% direct material and 50% conversion costs) 90,000 units

Units transferred in during the period 320,000 units

Cost transferred in this period

Rs.588,000

Work-in-process inventory-beginning

Cost transferred in

Rs. 89,000

Material

148500

Labor

75,000

Factory overhead60,000

Cost added during this period:

Direct materials

Rs.812,700

Direct labor

676,260

Factory overhead

487,300

Units transferred out to finished goods inventory

330,000

Ending units in process (45% direct materials, 60% conversion cost)------------ 70,000

Difference of units is treated as normal loss.

Instruction: Prepare Cost of Production Report for the month of April by FIFO method.

Labour CostingQ No.1Based on the data shown below, you are required to calculate the remuneration of each employee, as determined by each of the following methods:

100% bonus scheme, where the employee receives a bonus in proportion of the time saved to the time allowed:

Name of employee

SalmonRoach

Pike

Units produced

270

200

220

Time allowed in minutes per unit

10

15

12

Time taken in hours

40

38

36

Rate per hour

$1.25

$1.05

$1.2

Material CostingQ No.1The inventory data relating to an industry is as under:

Opening balance Jan.1.2003

800 units @ Rs.5

Received Feb. 2003

400 units @ Rs. 5.5

Issued March

500

Received April

200 units @ Rs.6

Issued May

400

Issued June

100

Other cost record show:

Direct labor

Rs.6000

FOH

4500

1000 units were manufactured and sold at 25% above cost

Required:

(a) Ending raw material inventory by FIFO METHOD

(b) Raw material consumed

(c) Cost of goods manufactured (d)Gross profit