Barley Ltd produces a certain food item in a manufacturingprocess. On 1st Novemb

Question

Barley Ltd produces a certain food item in a manufacturingprocess. On 1st November there was no opening stock in process.During November, 700 units of material were put in to process, witha cost of Rs, 20,000. Direct labor cost in November was Rs.15;000.production overhead is absorbed at the rate of 300% of directlabor costs. Closing stock on 30th November consisted of 200 unitswhich were 100% completed as to materials and 80% completed as tolabor and over head.

Required: Calculate the quantity of unitscompleted and transfer-out

Explanation / Answer

x.P5> QUANTITIES Physical Units Materials Conversion Cost Units to be accounted for Work in progress, Nov 1 0 Started into production 700 Total Units 700 Units accounted for Transferred Out 500 500 500 Work in progress, Nov 30 200 200 160 Total Units 700 700 660 COSTS Unit Cost Total Cost in Nov 20,000 60,000 80,000 Equivalent Unit 700 660 Unit Cost 29 91 119 Costs Accounted for

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