QUESTION 5 !Khaos Limited manufactures a single product. Production cost information for its first year of operation, appears below: Units manufactured Units sold Direct labour Direct materials Variable overheads Fixed overheads 80 000 units 64 000 units R40 per unit R16 per unit R1 200 000 R4 400 000

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Chapter5: Process Costing
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QUESTION 5
!Khaos Limited manufactures a single product. Production cost information for its first year of operation,
appears below:
Units manufactured
Units sold
Direct labour
Direct materials
Variable overheads
Fixed overheads
REQUIRED:
5.1
5.1.1
5.1.2
5.1.3
5.2
80 000 units
64 000 units
R40 per unit
R16 per unit
R1 200 000
R4 400 000
Determine, under both the absorption and variable costing methods, the -
production cost per unit;
profit for the year at a selling price of R180 per unit;
cost of closing inventory.
Reconcile the profits calculated in 5.1.3.
Transcribed Image Text:QUESTION 5 !Khaos Limited manufactures a single product. Production cost information for its first year of operation, appears below: Units manufactured Units sold Direct labour Direct materials Variable overheads Fixed overheads REQUIRED: 5.1 5.1.1 5.1.2 5.1.3 5.2 80 000 units 64 000 units R40 per unit R16 per unit R1 200 000 R4 400 000 Determine, under both the absorption and variable costing methods, the - production cost per unit; profit for the year at a selling price of R180 per unit; cost of closing inventory. Reconcile the profits calculated in 5.1.3.
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