Process Costing -Summer 2012

8/10/2019 Process Costing -Summer 2012

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Working: Equivalent Production Units:

Material Conversion

1 Units in process (at start) - Work this period 4,000 2,500

2 Units completed from current production 134,000 134,000

3 Units in process (at end) - Work this period 4,800 4,200

Equivalent Production units 142,800 140,700

1 QUANTITY SCHEDULE:

Units in process (at start) 10,000 (60% Material and 75% Conv

Units received from previous dept 140,000

TOTAL 150,000

Units completed and transferred out 144,000

Units in process (at end) 6,000 (80% Material and 70% Conv

TOTAL 150,000

2 Cost Charged to the department:

Cost Units Rate

a. Cost of WIP (at start) 98,000 - -

b. Cost incurred in previous dept 770,000 140,000 5.50

c. Cost added by the dept 3: EPU

Direct material 571,200 142,800 4.00

Direct labor 1,125,600 140,700 8.00

FOH 914,550 140,700 6.50

3,479,350 24.00

3. Cost Accounted for1 COST OF FINISHED GOODS

Total Finished goods = 144,000

a. 10,000 - Finished goods - WIP at start:

Cost incured till start (60% Material and 75% Conversion)

Add: Further cost incurred to complete 100%:

Direct material (10,000 units x 40% x Rs 4.00)

COST OF PRODUCTION REPORT:


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Direct labor (10,000 units x 25% x Rs 8.00)

Factory overhead (10,000 units x 25% x Rs 6.50)

Total cost incurred on 10,000 units

b. 134,000 - Finished goods - Current

(134,000 units x 100% x Rs 24.00)

Total Cost of Finished Goods

2 COST OF WORK IN PROCESS (AT END)

Total Work in process - at end 6,000

Inventory cost (6,000 units x Rs 5.50) 33,000

Direct material (6,000 units x 80% x Rs 4.0) 19,200

Direct labor (6,000 units x 70% x Rs 8.0) 33,600

Fatory overhead (6,000 units x 70% x Rs 6.50) 27,300

Total Cost of Work in process -at end

Previous dept (132,000 units x Rs 8.50) 1,122,000

Direct material (132,000 x 100% X Rs 5) 660,000

Direct labor (132,000 x 100% X Rs 4.5) 594,000

FOH (132,000 x 100% X Rs 8.5) 1,122,000 3,498,000


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rsion)

rsion)

98,000

16,000


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20,000

16,250

52,250

150,250

3,216,000

3,366,250

113,100

3,479,350


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Material Conversion

1 Units in process (at start) - Work this period 200 1,600







TOTAL 48,000


Units in process (at end) 3,000 (100% Material and 70% Con

TOTAL 48,000


Cost Units Rate


b. Cost incurred in previous dept 552,000 46,000 12.00


Direct material 242,550 46,200 5.25

Direct labor 116,750 46,700 2.50FOH 186,800 46,700 4.00

1,210,100 23.75

3. Cost Accounted for

1 COST OF FINISHED GOODS

Total Finished goods = 45,000

a. 2,000 - Finished goods - WIP at start:

Cost incured till start (90% Material and 20% Conversion)

Add: Further cost incurred to complete 100%:Direct material (2,000 units x 10% x Rs 5.25)

Direct labor (2,000 units x 80% x Rs 2.5)

Factory overhead (2,000 units x 80% x Rs 4.0)


b. 43,000 - Finished goods - Current

(43,000 units x 100% x Rs 23.75)



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rsion)

ersion)

112,000

1,050

4,000

6,400

11,450

123,450

1,021,250


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1,144,700

65,400

1,210,100


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Material Conversion

1 Units in process (at start) - Work this period - 1,800





Units in process (at start) 6,000 (100% Material, 70% Conver


TOTAL 160,000


Units in process (at end) 10,000 (100% Material, 80% Conver

TOTAL 160,000


Cost Units Rate


b. Cost incurred in previous dept 1,848,000 154,000 12.00


Direct material 924,000 154,000 6.00

Direct labor 1,230,400 153,800 8.00

FOH 1,845,600 153,800 12.00

5,936,000 38.00



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3. Cost Accounted for as follows


Total units in Finished Goods 142,000

a) 10,000 units - From Units in process - at start:Cost incurred till start - 40% Material and 70% conversion




Factory overrhead (10,000 units x 30% x Rs 8.50) 25,500


b) 132,000 units - From Current production

(132,000 units x 100% x Rs 26.50)

Total cost of Finished goods


Total units in process - at end 8,000

1. Previous dept (8,000 units x Rs 8.50) 68,000

b. Direct material (8,000 units x 90% x Rs 5) 36,000

c. Direct Labor (8,000 units x 40% x Rs 4.5) 14,400

d. FOH (8,000 units x 40% x Rs 8.5) 27,200

Cost of work in process - at end


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Previous dept (132,000 units x Rs 8.50) 1,122,000Direct material (132,000 x 100% X Rs 5) 660,000


FOH (132,000 x 100% X Rs 8.5) 1,122,000 3,498,000


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ion)

ion)


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96,000

69,000

165,000

3,498,000

3,663,000

145,600

3,808,600


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Material Conversion

1 Units in process (at start) - Work this period - 2,000





Units in process (at start) 5,000 (100% Material, 60% Conver

Units placed in production 195,000

TOTAL 200,000



TOTAL 200,000


Cost Units Rate


b. Cost added by the dept 1: EPU

Direct material 1,755,000 195,000 9.00

Direct labor 857,250 190,500 4.50

FOH 1,905,000 190,500 10.004,574,250 23.50




a) 5,000 units - From Units in process - at start:

Cost incurred till start - 100% Material and 60% conversion

Add: Further cost incurred to complete 100%:Direct material (5,000 units x 0% x Rs 9.00) -


Factory overrhead (5,000 units x 40% x Rs 10) 20,000



(169,000 units x 100% x Rs23.50)



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a. Direct material (26,000 units x 100% x 9.00) 234,000

b. Direct Labor (26,000 units x 75% x 4.5) 87,750

c. FOH (26,000 units x 75% x 10.00) 195,000





FOH (132,000 x 100% X Rs 8.5) 1,122,000 3,498,000


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ion)

ion)

57,000

29,000

86,000

3,971,500


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4,057,500

516,750

4,574,250


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Material Conversion






TOTAL 60,000



TOTAL 60,000


Cost Units Ratea. Cost incurred in previous dept 1,320,000 60,000 22.00



Direct labor 386,100 59,400 6.50

FOH 445,500 59,400 7.50

2,511,600 42.00



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a) 54,000 units - From Current production(54,000 units x 100% x Rs 42




1. Previous dept (6,000 units x Rs 22) 132,000

b. Direct material (6,000 units x 100% x 6) 36,000

c. Direct Labor (6,000 units x 90% x 6.5) 35,100

d. FOH (6,000 units x 90% x 7.5) 40,500





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FOH (132,000 x 100% X Rs 8.5) 1,122,000 3,498,000


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ion)


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2,268,000

2,268,000

243,600

2,511,600


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Material Conversion





Units in process (at start) 10,000 (60% Material and conversio


TOTAL 39,000


Units in process (at end) -

TOTAL 39,000


Cost Units Rate



Direct material 155,000 33,000 4.6970



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Direct labor 76,000 33,000 2.3030

FOH 60,800 33,000 1.8424

339,800 8.8424




a) 10,000 units - From Units in process - at start:

Cost incurred till start - 60% Material and conversion




Factory overrhead (10,000 units x 40% x Rs 1.8424) 7,370



(29,000 units x 100% x Rs 8.8424)



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FOH (132,000 x 100% X Rs 8.5) 1,122,000 3,498,000


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)


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48,000

35,370

83,370

256,430

339,799

339,799


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Units in process (at start) 5,000 (100% Mat, 70% Conv)

Units received from dept 1 95,000

TOTAL 100,000


Units in process (at end) 2,000 (100% Mat, 30% Conv)

100,000


Cost Units Rate



Total units completed during the period = 98,000

a) From beginning work in process (5,000 units):

Cost incurred till start 10,000

Add: Further cost incurred to complete 100%

Direct material (5,000 x 0% x 5) -

Direct labor (5,000 x 30% x 4) 6,000

FOH (5,000 x 30% x 4.50) 6,750

Total cost incurred to complete 5,000 units 22,750

b) From current production (93,000 units)

(93,000 units x 100% x 24) 2,232,000

Total cost of Finished goods 2,254,750


Inventory cost (2,000 units x 12) 24,000

Direct material (2,000 units x 100% x 3.50) 7,000

Direct labor (2,000 units x 30% x 4) 2,400

FOH (2,000 units x 30% x 4.50) 2,700


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Total cost of WIP (at end) 36,100

2,290,850


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Material

1. Units completed and transferred out 98,000

2. Less: WIP (Start) - all units (5,000)

Units started and completed 93,000

3. Add: WIP (Start) - work this period -

4. Add: WIP (End) - work this period 2,000

Equivalent Production Units 95,000


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Conversion

98,000

(5,000)

93,000

1,500

600

95,100


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TOTAL 100,000


Units in process (at end) 18,000 (100% Mat, 80% Conv)

100,000


Cost Units Rate

a. Per unit received from Previous dept 600,000 100,000 6.00

b. Cost added by the dept:

Direct materail 250,000 100,000 2.50

Direct labor 289,200 96,400 3.00

FOH 385,600 96,400 4.00

1,524,800 15.5




From current production (82,000 units)

(82,000 units x 100% x 15.50) 1,271,000

Total cost of Finished goods 1,271,000



Direct material (18,000 x 100% x 2.50) 45,000

Direct labor (18,000 x 80% x 3) 43,200

FOH (18,000 x 80% x 4) 57,600


1,524,800


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Material

1. Units completed and transferred out 82,000

Units started and completed 82,000

2. Add: WIP (End) - work this period 18,000

Equivalent Production Units 100,000


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Conversion

82,000

82,000

14,400

96,400


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FOH (6,000 x 30% x 4) 7,200

Total cost incurred to complete 6,000 units 68,800

b) From current production (84,000 units)

(84,000 x 100% x 9) 756,000

Total cost of Finished goods 824,800


Direct material (10,000 units x 75% x 2) 15,000

Direct labor (10,000 units x 40% x 3) 12,000

FOH (10,000 units x 40% x 4) 16,000


867,800


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COST OF PRODUCTION REPORT - Dept A


Units put into proc ess 30,000

TOTAL 30,000


Units in process (at end) 5,000 (60% Material % 60% Conv)

30,000


Cost Units Rate

a. Cost added by the dept A: EPU


Direct labor 19,600 28,000 0.70

FOH 14,000 28,000 0.50

56,000 2.0




From current production (25,000 units)

(25,000 units x 100% x 2) 50,000


2 COST OF WORK IN PROCESS (AT END)Direct material (5,000 units x 60% x 0.80) 2,400

Direct labor (5,000 units x 60% x 0.70) 2,100

FOH (5,000 units x 60% x 0.50) 1,500

8 Total cost of WIP (at end) 6,000

56,000

COST OF PRODUCTION REPORT - Dept B



TOTAL 25,000



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Units in process (at end) 4,000 (60% Material % 60% Conv)

25,000


Cost Units Rate

a. Per Unit cost of previous dept. 50,000 25,000 2

b. Cost added by the dept B: EPU


Direct labor 14,040 23,400 0.60

FOH 28,080 23,400 1.20

101,480 4.2


COST OF FINISHED GOODS


From current produ

(21,000 units x 100% x 4.2) 88,200




Direct material (4,000 units x 60% x 0.40) 960

Direct labor (4,000 units x 60% x 0.60) 1,440

FOH (4,000 units x 60% x 1.20) 2,880

8 Total cost of WIP (at end) 13,280

101,480

Entries in Process Costing:

1. Transfer of units from one process to another process:

Work in Process (Dept B) 50,000

Work in Process (Dept A) 50,000

(To record: the transfer of 25,000 units

from Dept A to Dept B)

2 Transfer Finished goods to Ware house:

Finished Goods 88,200

Work in Process (Dept B) 88,200


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(To record: the transfer of 21,000 units

from Dept B to Ware house)


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Material Conversion

1. Units completed and transferred out (FG) 25,000 25,000

2. Add: WIP (End) - work this period 3,000 3,000

Equivalent Production Units 28,000 28,000


Material Conversion

1. Units completed and transferred out (FG) 21,000 21,000

2. Add: WIP (End) - work this period 2,400 2,400

Equivalent Production Units 23,400 23,400


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Dept 1 Dept 2

1 Units in process - at start 2,000 5,000

2 Cost of WIP - at start 22,000 48,000

3 Units placed in production 58,000 -

4 Units in process - at end 5,000 10,000

5 Cost added by the department:

Direct material 155,000 210,000Direct labor 250,000 187,000

FOH 145,000 195,000

Stage of Completion:

Work in process - at start 25% Mat 45% Mat

95% Conv 55% Conv

Work in process - at end 100% Mat 85% Mat

45% Conv 25% Conv


Material Conversion

1 Units in process (at start) - Work this period 1,500 100





Units in process (at start) 2,000 (25% Material and 95% Co


TOTAL 60,000


Units in process (at end) 5,000 (100% Material and 45% C

TOTAL 60,000


Cost Units Rate

a. Cost of WIP (at start) 22,000


Direct material 155,000 59,500 2.6050

Direct labor 250,000 55,350 4.5167

FOH 145,000 55,350 2.6197

572,000 9.7414



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1 COST OF FINISHED GOODSTotal numbers of units completed = 55,000

a. 2,000 completed from Beginning Inventory

Cost incurred till start (25% Material, 95% Conversion) 22,000


Direct material (2,000 units x 75% x Rs. 2.6050) 3,908

Direct labor (2,000 units x 5% x Rs.4.5167) 452

Factory overhead (2,000 units x 5% x Rs. 2.6197) 262


b. 53,000 completed from current production

(53,000 units x 100% x Rs. 9.7414)

Total cost of Finished goods - 55,000 units


Direct material (5,000 units x 100% x Rs 2.6050 13,025

Direct labor (5,000 units x 45% x Rs 4.5167 10,163

Factory overhead (5,000 units x 45% x Rs 2.6197 5,894

Total cost of Work in process -at end


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nversion)

onversion)


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26,621

516,294

542,915

29,082

571,997


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Material Conversion








TOTAL 50,000


Units in process (at end) 10,000 (70% Material and 60% Conv

TOTAL 50,000


Cost Units Rate

a. Cost of WIP (at start) 26,000



Direct labor 172,000 43,000 4.00

FOH 193,500 43,000 4.50

543,750 12.00



Total numbers of units completed = 40,000

a. 5,000 completed from Beginning Inventory

Cost incurred till start (70% Material, 60% Conversion) 26,000



Direct labor (5,000 units x 40% x Rs 4.00) 8,000Factory overhead (5,000 units x 40% x Rs 4.50) 9,000


b. 35,000 completed from current production

(35,000 units x 100% x Rs 12)




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Factory overhead (10,000 units x 60% x Rs 4.50) 27,000



Material Conversion

1 Units in process (at start) - Work this period - -


3 Units in process (at end) - Work this period 1,200 800



Units in process (at start) -

Units received from Dept 1 40,000

TOTAL 40,000


Units in process (at end) 2,000 (60% Material and 40% ConvTOTAL 40,000


Cost Units Rate

a. Per unit cost received from dept 1 468,250 40,000 11.7063


Direct material 200,000 39,200 5.1020

Direct labor 250,000 38,800 6.4433

FOH 350,000 38,800 9.02061,268,250 32.2722



Total numbers of units completed = 38,000

38,000 completed from current production



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(38,000 units x 100% x Rs 32.2722)



Inventory Cost (2,000 units x Rs 11.7063) 23,413


Direct labor (2,000 units x 40% x Rs 6.4433) 5,155Factory overhead (2,000 units x 40% x Rs 9.0206) 7,216



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rsion)

rsion)

48,250

420,000

468,250


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75,500

543,750

rsion)


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1,226,344

1,226,344

41,906

1,268,250

Documents

Process Costing -Summer 2012