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Okara Quality Carpets Ltd makes a product which involves two processes. Process 1 results in the production of a low-priced

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Okara Quality Carpets Ltd makes a product which involves two processes. Process 1 results in the production of a low-priced by-product which the company sells. 2000 units of the product were made in process I and transferred to process 2. Work in progress at the end of process 2 consisted of 800 units complete as to 75% material and 50% labour. Further production details are as follows.


Required 

Prepare Process accounts 1 and 2 to show the cost of producing 2000 units. Show detailed workings for the valuation of finished units and work in progress in process 2.

Transcribed Image Text:

Data per unit Material Cost of material Labour hours per unit Labour hourly rate Production overhead absorption Sale proceeds of by-product Process 1 4 kg $12 per kg 3 Process 2 2.5 kg $3.25 per kg 5 $14 $11 $36 per labour hour $27 per labour hour $1630

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Related Book For  answer-question
Accounting A Level And AS Level

Accounting A Level And AS Level

ISBN: 9780521539937

1st Edition

Authors: Harold Randall

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Question Details
Chapter # 32- Process Costing
Section: Exercises
Problem: 3
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Question Posted: August 29, 2023 08:17:22
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