Question Two Pass-Well Company Limited produces a product that passes through two processes, Process 1 and Process 2. Details of activities for the month of December, 2020 is as follows; Process 1 @GH₵200.00 200hrs 3,500units GH₵20 per unit Process 2 GH₵25,000.00 600hrs 3,150units GH₵40 per unit a. You are required to prepare the relevant accounts b. You are required to prepare the relevant Accounts With practical example, differentiate between cost assignment and cost apportionment; product cost and period costs; direct Material introduced (4,000 units) Material added Labour Costs (@GH₵400 per hour) Output in units Scrap value of normal loss Note; i. Overhead is absorbed at 80% of labour costs. ii. Normal loss is estimated at 10% for both process. iii. No opening and closing stocks cost and indirect cost
Question Two Pass-Well Company Limited produces a product that passes through two processes, Process 1 and Process 2. Details of activities for the month of December, 2020 is as follows; Process 1 @GH₵200.00 200hrs 3,500units GH₵20 per unit Process 2 GH₵25,000.00 600hrs 3,150units GH₵40 per unit a. You are required to prepare the relevant accounts b. You are required to prepare the relevant Accounts With practical example, differentiate between cost assignment and cost apportionment; product cost and period costs; direct Material introduced (4,000 units) Material added Labour Costs (@GH₵400 per hour) Output in units Scrap value of normal loss Note; i. Overhead is absorbed at 80% of labour costs. ii. Normal loss is estimated at 10% for both process. iii. No opening and closing stocks cost and indirect cost
Chapter4: Preparing And Using Financial Statements
Section: Chapter Questions
Problem 2EP
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Question Two
Pass-Well Company Limited produces a product that passes through two processes, Process 1 and Process 2. Details of activities for the month of December, 2020 is as follows;
Process 1
@GH₵200.00
200hrs 3,500units GH₵20 per unit
Process 2
GH₵25,000.00 600hrs 3,150units GH₵40 per unit
a. You are required to prepare the relevant accounts
b. You are required to prepare the relevant Accounts With practical example, differentiate
between cost assignment and cost apportionment; product cost and period costs; direct
Material introduced (4,000 units) Material added
Labour Costs (@GH₵400 per hour) Output in units
Scrap value of normal loss
Note;
i. Overhead is absorbed at 80% of labour costs.
ii. Normal loss is estimated at 10% for both process.
iii. No opening and closing stocks
cost and indirect cost
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