Regarding Cost Accounting,

Q2:

The following operations took place in Al Rabeeh Industrial Corporation, which follows the production orders system, within a month (Dhu al-Hijjah 1438 AH) Hijri date

• Purchase of materials and raw materials for cash worth 25,000 riyals.
• The cost of the direct materials spent and used in the two orders (55,54) 8,000 riyals for the production order (54) and 6,000 riyals for the production order (55).
• Accrued wages are 45,000 riyals, of which 3,000 riyals are deductions. Pay the accrued wages and deductions in cash, noting that one third of the wages are for production workers and the rest are the wages of supervisors. Order (54) received a quarter of the direct wages and the remainder for Order No. (55).
• Charged indirect industrial costs are charged at a rate of 50% of the initial cost.
• Order No. (55) has been completed and has been sold for 40,000 riyals on the account.

Required:

1. Record the necessary journal entries.
2. Determine the cost of production orders 54 & 55.
3. Determine the amount of profit or loss achieved by the organization from selling production order number 55.