In the production of cotton fabric, Fine Fabric makes use of two processes. As a management accountant,
Question:
In the production of cotton fabric, Fine Fabric makes use of two processes. As a management accountant, you have been requested to calculate the value of finished goods for the month ended 31 March 2019. You have been provided with the following information related to Process B for the month ended 31 March 2019:
Opening work-in-progress (OWIP) costs: | R |
Process 1 | 420 |
Material | 550 |
Conversion costs | 1 600 |
Costs incurred during March 2019: | R |
Transferred from the previous process | 5 470 |
Material | 4 100 |
Conversion costs | 12 006 |
Metres of polyester fabric for Process 2 (March 2019): | |
OWIP (80% complete) | 50 metres |
Transferred in from the previous process 1 500 metres
Finished goods 1 200 metres
Closing WIP (35% complete) 120 metres
Additional information for Process 2:
Material is issued at the 20% mark of the production process.
Conversion costs are incurred evenly during the process.
Normal wastage is estimated at 10% of input and takes place when production is 40% complete. Cotton fabric that is wasted has a saleable value of R1.20 per metre.
Abnormal loss units do not share in the normal loss allocation.
The company uses the weighted average stock valuation method.
Required:
Calculate the value of finished goods for the month ended 31 March 2019.
Discovering Advanced Algebra An Investigative Approach
ISBN: 978-1559539845
1st edition
Authors: Jerald Murdock, Ellen Kamischke, Eric Kamischke