A company operates on historic job cost accounting system, which is not integrated with the financial accounts. At the beginning of a month, the opening balances in the Cost Ledger were : $ (in lakhs) 80 Stores Ledger Control Account Work-in-Progress Control Account Finished Goods Control Account Building Construction Account Cost Ledger Control Account During the month, the following transactions took place : 20 430 10 540 - Purchased Issued to production Issued to general maintenance Issued to building construction - Gross wages paid Indirect wages For building construction - Actual amount incurred (excluding items shown above) Absorbed in building construction Under absorbed Materials 40 50 4 150 40 10 Wages Works Overheads 160 Royalty paid Selling distribution and administration overheads Sales 20 8 5 25 450 At the end of the month, the stock of raw material and work-in-progress was $ 55 lakhs and $ 25 lakhs respectively. The loss arising in the raw material account is treated as factory overheads. The building under construction was completed during the month. Company's gross profit margin is 20% on sales. Prepare the relevant Control Accounts to record the above transactions in the Cost Ledger of the company
A company operates on historic job cost accounting system, which is not integrated with the financial accounts. At the beginning of a month, the opening balances in the Cost Ledger were : $ (in lakhs) 80 Stores Ledger Control Account Work-in-Progress Control Account Finished Goods Control Account Building Construction Account Cost Ledger Control Account During the month, the following transactions took place : 20 430 10 540 - Purchased Issued to production Issued to general maintenance Issued to building construction - Gross wages paid Indirect wages For building construction - Actual amount incurred (excluding items shown above) Absorbed in building construction Under absorbed Materials 40 50 4 150 40 10 Wages Works Overheads 160 Royalty paid Selling distribution and administration overheads Sales 20 8 5 25 450 At the end of the month, the stock of raw material and work-in-progress was $ 55 lakhs and $ 25 lakhs respectively. The loss arising in the raw material account is treated as factory overheads. The building under construction was completed during the month. Company's gross profit margin is 20% on sales. Prepare the relevant Control Accounts to record the above transactions in the Cost Ledger of the company
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter2: Accounting For Materials
Section: Chapter Questions
Problem 8P
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