Page 297 - DCOM202_COST_ACCOUNTING_I

Unit 14: Equivalent Production in Process Costing

Closing stock: 2,000 units Notes
Degree of completion: Materials 50%
Labour 20%

production overhead 20%
prepare the process and other accounts using weighted average cost method.
Solution:

Statement of Equivalent Units

Production
Material A Material B Labour
Particulars Units Overheads
Units % Units % Units % Units %
Normal Loss 750(a) -- -- -- -- -- -- -- --
Completed units 14,500 14,500 100 14,500 100 14,500 100 14,500 100
Closing stock 2,000 2,000 100 1,000 50 400 20 400 20
17,250 16,500 15,500 14,900 14,900
Less : Abnormal gain 250(d) 250 100 250 100 250 100 250 100
Total 17,000 16,250 15,250 14,650 14,650

Statement of Cost of Equivalent Units
Equivalent Cost per Equivalent
Particulars (`) Cost (`)
Units unit (`)
Materials (A) :
Opening WIp 4,000
process 1 81,000
85,000
Less: Scrap of Normal @ ` 5 x 750 units 3,750 81,250 16,250 5.00
Materials (B) :
Opening WIp 2,000
Add: Materials 43,750 45,750 15,250 3.00
Labour :
Opening WIp 350
Add: Current cost 14,300 14,650 14,650 1.00
production Overhead :
Opening WIp 800
Add: Current period 28,500 29,300 14,650 2.00
1,70,950

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