Excel Academy of Commerce

Hassan Jameel
0333-8891667

A product requires processing in three departments. In the third department material are add.
Doubling the number of units. The following data relate to the operation of department 3 for
May:

Units received from department 2 = 10,000 units

Units transferred to finish goods = 16,000 units
The balance of units were still in process
(100% material, 50% Labour & Foh)

Cost transfer from department 2 =Rs. 15000

Cost added by this department
Material Rs. 4400
Labour Rs.4500
FOH Rs.3600

Cost of production report

Rani beauty products received 16000 units at a cost of Rs.412, 640. Department 3 completed
production on 14400 units. There was an abnormal loss of 600 units when 75% converted by
department 3. Units in process was 25% converted. Material is added at the end of process
Cost added in department 3
Direct material Rs.118224
Direct Labour Rs. 49075
Foh Rs.41525

The cost department of the ali manufacturing company made the following data and cost available for
the year 2008
Particular Rs. Rs. Particular Rs.
Jan Dec 31,
1,2008 2008
Raw Material 34200 49300 Material purchased 364000
Work in process 81500 43350 Direct labour 162500
Finish goods 32400 ? Indirect labour 83400
Fright in 8600
Deprecation 21350 Interest earned 6300
Purchase discount 5200 Misc. FOH 47900

Finish goods inventory jan 1 : 200 units December 31:220 units.

Sold during the year 3900 units @ Rs. 224
Required
1. Cost of goods sold
2. Gross profit in total and units