This assignment is aimed to enable the students to develop fundamental information for presenting in a cost of production report while learning the treatment of normal losses and FIFO costing method of work in process inventory.
S&N Corporation manufactures men’s garments which pass through two departments. Company uses process costing system and work-in-process inventories are treated at first-in, first-out basis. For the month of December 2013, the company’s cost accountant is planning to prepare a cost of production report for the 1st department.
Production and cost data for the 1st department during the month of December, 2013 is as follows:
Production Data (Units):
Units in process - 1st December, 2013 (50% complete as to material and 25 % as to conversion cost)
Units started during December, 2013
Units completed and transferred out
Units lost during processing (normal loss)
Units in process - 31st December, 2013 (75% as to material and 50% as to conversion cost)
Production costs data (Rupees):
Cost incurred on opening work in process inventory:
Cost incurred during December 2013:
Total cost to be accounted for
Required: Prepare following for the month of December 2013 under FIFO costing method.
a) Quantity Schedule (5 Marks)
b) Schedule of cost accumulated in the department (5 Marks)
c) Schedule of total cost accounted for/cost apportionment (5 Marks)
d) Schedule of equivalent production (2.5 Marks)
e) Calculation of cost per unit (2.5 Marks)
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RULES FOR MARKING
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Please also note that assignment in this course is non-graded and don’t have weightage in total marks of the subject.
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