Well this is not an usual post based on some statistical functions, rather here i will discuss how to setup a Process Costing Sheet for yourself. If you have been employed as a Cost Accountant and you are just beginning your career, you might find a temple helpful in your work that can easily calculate the Process Cost. So here we go:
Steps:
1. Setup a Sheet:
Setup an Excel Sheet, with usual heading. These included Quantity Schedule, Cost Charged to the Department & Cost Accounted for by the Department.
2. Develop Relations among Variables:
Yes, you need to develop the relations between the Variables. In Quantity Schedule we will be equating the Total Quantity Received against Quantity Transferred to the Next Department, Material Losses & Work In Process Inventory. You may Also want to add the Abnormal Losses in the sheet.
We also be calculating the Adjusted Amount of Finished Goods that is transferred to the next Department in order to account for the Work In Process Inventory.
The Example Question:
For December, the Production Control Department of Carola Chemical, reported the following data from Department 02:
Transferd in From Department 1........................... 55000 Liters
Tranfered out from Department 2......................... 39500 Liters
Work in Process Units (1/3rd Complete by Conv)........ 10500 Liters
All materials were put into process in Department 1
Unit Cost from Department 01 ............................ $ 1.8
Labour Cost in Department 02 ............................ 25720
Appalied Factory Overhead Department 02 ..............15480
Required: A Cost of Production Report for Department 02.
Solution:
Here is what is given you will need to do to get the solution:
The Solution is not possible without having some side-line calculation, the other part of the spread sheet will provide these values, see the following picture.
I have upload the Sample file here so that you can try it yourself. Hope that you will find it useful. Please provide your feedback. Thank you!!
No comments:
Post a Comment