In the situation described in the following example discuss which costs, if any, should be included in
Question:
In the situation described in the following example discuss which costs, if any, should be included in the stock valuation, and at what point in time they should be included.
Hank is in business manufacturing sails. The sail material is purchased in 100m lengths and these are delivered to the storeman who sorts the materials according to quality and width. The material is then issued to the cutting room where five people are employed, one of whom is the cutting room supervisor. After cutting, the material is passed through to the machining room where the sails are sewn up and the hanks etc.
are put on. The machining room has seven staff employed full time including a supervisor. From the machining room the sails go through to the packaging department where they are folded, inserted in sail bags and either sent to the despatch department or put into stock. The packaging department and the despatch department each employ one member of staff working on a part-time basis. The whole operation is under the control of a production manager who also has responsibility for quality control.
Step by Step Answer:
Accounting In A Business Context
ISBN: 978-0412375101
1991st Edition
Authors: AIDAN BERRY And ROBIN JARVIS