Question
The Health and Wellness Trading produces a special type of moisturizing cream that is widely used by beautician to soothe and moisturize skin after giving
The Health and Wellness Trading produces a special type of moisturizing cream that is widely used by beautician to soothe and moisturize skin after giving peeling facial treatment to their customers. The cream passes through two processes namely BX and BY. For the month of June 2020, the following data are available in Process BX:
| Particulars | Units | RM |
| Opening work-in process: | 2,000 | |
| Material (100% complete) | 80,000.00 | |
| Labour (80% complete) | 15,000.00 | |
| Overheads (80% complete) | 45,000.00 | |
| Materials introduced in Process BX | 38,000 | 1,480,000.00 |
| Labour | 359,000.00 | |
| Overheads | 1,077,000.00 | |
| Units scrapped | 3,000 | |
| Closing work-in process: | 2,000 | |
| Material (100% complete) | ||
| Labour and Overheads (80% complete) | ||
| Finished and transferred to Process BY | 35,000 |
Normal loss units are 5% of total input including opening work-in process. Material for the product is put in the process at the beginning of the cycle of operation, whereas labour and other indirect cost flow evenly over the year. Scrapped units are fetch at RM20.00 per piece.
Required:
Assume that Health and Wellness Trading operates a weighted average stock management system, prepare:
a. the relevant statement for Process BX.
b. the Process BX account for the period.
c. the Normal and Abnormal Loss Accounts.
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Cornerstones of managerial accounting
Authors: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
5th edition
978-1305302327, 130530232X, 978-1133943983
