90.2K

Verified Solution

Link Copied!

S Industrial Limited hasthe following informationrelating to one of itsproduction processes for the month of March 2023:

(1) Opening work in progress was 2,000 units at K24,800 and its breakdown was:

Degree of

Completion K

Materials input 100% 12,000

Labour 40% 10,000

Overheads 30% 2,800

24,800

(2) Costs incurred during the period were:

Materials input 10,000 units at K72,500

Labour K36,000

Overheads K25,800

(3) Closing work in process were 3,000 units and their degree of completion of

Individual components were:

Materials input 100%

Direct labour 60%

Overheads 40%

(4) Normal loss was 10% of the materials input during current period. The scrap value

of loss was K5 per unit. 1,200 units were actually scrapped during the month. It is the company's cost accounting policy to deduct the scrap value of normal loss from

the cost of materials input in the current process.

REQUIRED:

(a) Prepare the following accounts for the month of March 2023 using the first in

first out method

1. Process account (15 marks)
2. Abnormal loss account ( 5 marks)

S Industrial Limited hasthe following informationrelating to one of itsproduction processes for the month of March 2023:

(1) Opening work in progress was 2,000 units at K24,800 and its breakdown was:

Degree of

Completion K

Materials input 100% 12,000

Labour 40% 10,000

Overheads 30% 2,800

24,800

(2) Costs incurred during the period were:

Materials input 10,000 units at K72,500

Labour K36,000

Overheads K25,800

(3) Closing work in process were 3,000 units and their degree of completion of

Individual components were:

Materials input 100%

Direct labour 60%

Overheads 40%

(4) Normal loss was 10% of the materials input during current period. The scrap value

of loss was K5 per unit. 1,200 units were actually scrapped during the month. It is the company's cost accounting policy to deduct the scrap value of normal loss from

the cost of materials input in the current process.

REQUIRED:

(a) Prepare the following accounts for the month of March 2023 using the first in

first out method

1. Process account (15 marks)
2. Abnormal loss account ( 5 marks)

Answer & Explanation Solved by verified expert

See Answer