50-7A Company manufactures three products namely X, Y and Z using the same plant and process. The VAC following information are related to a production period: Product Output in units 2,000 5,000 7,000 The production overhead and cost drivers are: Overhead Setup cost Stores receiving. Inspection and control.. Material handling and dispatch Material cost per Labour hour per Direct labour cost per unit hour Rs.6 Rs.4 Rs.8 unit Rs.50 Rs.30 Rs.20 5 hours 3 hours 1 hour Cost drivers No of production runs Requisition raised No of production runs Orders executed Amount (Rs.) 1,54,000 21,000 84,000 56,000 3,15,000 Additional information: Three products were produced in a production run of 50 units each i. The requisition raised for the period in the stores for product X, Y and Z were 10, 20 and 30 respectively, The number of order being in a batch of 100 units for each product and number of total order executed was 140. Required: Statement of total cost and cost per unit for each product by using: a Conventional absorption costing on the basis of labour hours, b. An activity based costing using suitable cost drivers. 103.75 614 505
50-7A Company manufactures three products namely X, Y and Z using the same plant and process. The VAC following information are related to a production period: Product Output in units 2,000 5,000 7,000 The production overhead and cost drivers are: Overhead Setup cost Stores receiving. Inspection and control.. Material handling and dispatch Material cost per Labour hour per Direct labour cost per unit hour Rs.6 Rs.4 Rs.8 unit Rs.50 Rs.30 Rs.20 5 hours 3 hours 1 hour Cost drivers No of production runs Requisition raised No of production runs Orders executed Amount (Rs.) 1,54,000 21,000 84,000 56,000 3,15,000 Additional information: Three products were produced in a production run of 50 units each i. The requisition raised for the period in the stores for product X, Y and Z were 10, 20 and 30 respectively, The number of order being in a batch of 100 units for each product and number of total order executed was 140. Required: Statement of total cost and cost per unit for each product by using: a Conventional absorption costing on the basis of labour hours, b. An activity based costing using suitable cost drivers. 103.75 614 505
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:A Company manufactures three products namely X, Y and Z using the same plant and process. The
are related to a production period:
50-7.
following information
Y.
Product
Output in units
2,000
5,000
7,000
The production overhead and cost drivers are:
Overhead
Setup cost.
Stores receiving
Inspection and control..
Material handling and dispatch
Material cost per Labour hour per Direct labour cost per
unit
unit
hour
Rs.50
Rs.6
Rs.30
Rs.4
Rs.20
Rs.8
5 hours
3 hours
1 hour
Cost drivers
No of production runs
Requisition raised
No of production runs
Orders executed
Amount (Rs.)
1,54,000
21,000
84,000
56,000
3,15,000
Additional information:
Three products were produced in a production run of 50 units each
i.
The requisition raised for the period in the stores for product X, Y and Z were 10, 20 and 30 respectively,
The number of order being in a batch of 100 units for each product and number of total order
executed was 140.
Required: Statement of total cost and cost per unit for each product by using:
a Conventional absorption costing on the basis of labour hours,
b. An activity based costing using suitable cost drivers.
Ans. a. Cost per unit (Rs.): 129.21, 71.53, 37.84 b. Cost per unit (Rs.): 102.75, 64.4, 50.5
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