A & Co manufactured 500 ceiling fans to fill an order by incurring: Direct material Rs. 150,000 Direct labor cost Rs. 100,000 F.O.H (60% of labor cost) Rs. 60,000_ Total production cost Rs. 310,000 Some of the work was found defective, to make good such loss, following cost was incurred: Rework cost on defective work Material Rs. 10,000 Labor Rs. 30,000 F.O.H (60% of Labor cost) Rs. 18,000 Required: Pass accounting entries to record the cost incurred along with the adjusting entry for re-work cost, treating the loss as: a) Normal b) Abnormal
A & Co manufactured 500 ceiling fans to fill an order by incurring:
Direct material Rs. 150,000
Direct labor cost Rs. 100,000
F.O.H (60% of labor cost) Rs. 60,000_
Total production cost Rs. 310,000
Some of the work was found defective, to make good such loss, following cost was incurred:
Rework cost on defective work
Material Rs. 10,000
Labor Rs. 30,000
F.O.H (60% of Labor cost) Rs. 18,000
Required:
Pass accounting entries to record the cost incurred along with the
a) Normal
b) Abnormal
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