Bolder Chemicals Limited manufactures a product, Zander, within two separate processes. For the week ended September 24,
Question:
Bolder Chemicals Limited manufactures a product, Zander, within two separate processes. For the week ended September 24, 2011, the details were:
Process!
Materials input, 4000kilos @ $3 per kilo
Labour $1,840
Overheads $2,150
Process 2
Materials input 2,200 kilos @$4 per kilo
Labour $1,420
Overheads $1,050
Normal outputs are: Process 1, 90% of input Process 2, 80% of input
All losses have a scrap value of $0.50 per kilo
Output during the week was 3,700 kilos from Process 1 and 4,600 kilos from Process 2.
Required:
As the accounts assistant at Bolder Chemicals Limited, you are asked to prepare:
a. The process 1 account for the week ended 24 September 2011 (11 marks)
b. The process 2 accounts for the week ended 24 September 2011 (12 marks)
c. Distinguish between normal and abnormal loss and state how the balances on the abnormal loss and abnormal gain accounts are treated at the end of the accounting period.
Calculate costs per unit of expected output to the nearest cent.
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill