PROCESS COSTING

( COST OF PRODUCTION REPORT) –ASSIGNMENT QUESTIONS ( Question#1 and 2 )

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

Cost transferred from previous department Rs. 80,000

Cost added in current period:
Material cost 75,000
Labor cost 53,700
Overhead cost 35,800
Production information:
Units received from previous department --------------------------------------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)----------------------------------------------- 3,500

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

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

Cost transferred from previous department Rs.300,000

Cost added by this department:
Material cost 250,000
Labor cost 175600
Overhead cost 150,000

Production information:

Units from preceding department ------------------------------------------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)------------------------------------------9,000

Inspection is done at the 95% stage of production. Normal spoilage is expected at the rate of 2%
of good output.
Instruction: Prepare Cost of Production Report for the month of September.

Q No.3 :PROCESS COSTING

Information 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 UNITS
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)-----------------------------------------------9000
Instruction: Prepare Cost of Production Report for the month of August

Q No.4
Information 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)-----------------------------------------------2500
Instruction: 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)-------------------------------------------70,000

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

Q 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)------------ 115,000
Difference 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 Method

Opening Work-in-process
Material Rs.1500
Labor 2000
FOH 1000
4500
Opening 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.37500
Labor Rs.55000
FOH Rs.27500
Units completed during the month 4800
Units 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
Material Conversion
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.9
Energy resources company refines a variety of petrochemical products. The following data are
from the firm’s 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.11Beginning 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 overhead 60,000
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.