The following data relate to Process 2 for one accounting period. Process 2 receives units from Process
Question:
The following data relate to Process 2 for one accounting period. Process 2 receives units from Process 1 and, after processing, transfers them to Process 3.
Opening WIP 600 units
Value (GH¢) | Percentage Complete (%) | |
Input materials | 720 | 100 |
Material introduced | 500 | 60 |
Labour | 340 | 50 |
Overheads | 270 | 40 |
Transfers from process 1: 4,100 units valued at GH¢5,200. Transfers to process 3: 3,500 units
GH¢
Material introduced | 2,956 |
Labour | 2,200 |
Overheads | 1,900 |
Closing stock 800 units at the following stage of completion Input material 100% complete
Material introduced 60% complete
Labour 50% complete
Overheads are 40% complete
400 units were scrapped at the following stage of completion Input material 100% complete
Material introduced 100% complete
Labour 40% complete
Overheads are 30% complete
The normal loss is 10% of production and the scrapped units realized 40 pesewas each.
It is required to prepare the Process Account for Process 2 using the FIFO method and the weighted average cost method.
Financial Reporting and Analysis Using Financial Accounting Information
ISBN: 978-1439080603
12th Edition
Authors: Charles H Gibson