Question 2: Process Costing, Relevant costs, and Decision-Making Techniques Part A Covid Medicines manufactures vaccines using a single line process, the production process. The details of the production process for the current period were the following. There were 500 units of opening work in progress, with values as follows: Material Conversion Cost (Labour and Production Overheads) 77,000 40,000 During the period, 1800 units were added to the process and the following costs were incurred: Material 381,200 Conversion Cost (Labour and Production Overheads) 390,000 There were 600 units of closing work in progress, which were 100 per cent complete for material and 80 per cent complete for conversion costs. A normal loss equal to 10 per cent of new material input during the period was expected. The actual loss amounted to 200 units. Each unit of loss was sold for 10 per units. SA Required: a) Calculate whether there was a normal or abnormal loss or abnormal gain for the period. (2 Marks) b) Using the weighted average method, calculate the good output for the period. What assumptions need to be taken into account regarding the opening work in progress? (2 Marks) c) Using the weighted average method, show the production process costs, clearly identifying costs accounted for equivalent unit costs and costs assigned to finished goods and work in progress. (9 marks) d) Based on the weighted average method, prepare the production process account for the period, showing clearly weights and value figures. (5 marks) Part B Xple intends to use relevant costs as the basis of the selling price for a special order, the pricing of a brochure. The brochure requires a particular type of paper that is not regularly used by X although a limited amount is in X ple's inventory, which was left over from a previous job. The cost when X purchased this paper last year was 15 per ream and there are 100 reams in inventory. The brochure requires 250 reams. The current market price of the paper is 26 per ream, and the resale value of the paper in inventory is 10 per ream. Required: c) What is the relevant cost of the paper to be used in printing the brochure? (7 Marks) 1) Explain the concept of perfect and imperfect information in a decision-making context under conditions or risk and uncertainty. Use a numerical example to support your answer. (5 Marks) [Total: 30 marks)