Case N ° 3 The industrial company Arica S.A. It treats a raw material A and a raw material B in Workshop 1. At the exit of this workshop a semi-finished or intermediate product is obtained that goes to the warehouse. This semi-finished product is treated again in Workshop 2, and when it leaves the finished products X and Y that enter the warehouse are produced. Regarding its economic organization, the company is divided into the following activity centers (two auxiliary and four main), which allow control over indirect costs: Administration, Energy, Purchasing, Workshop 1, Workshop 2 and Sales. I. Data common to general accounting and cost accounting: The data that constitute the starting situation of Cost Accounting are: a) Opening stocks: - Raw material A (12,000 kg): ¢ 25,200 - Raw material B (36,000 kg): ¢ 95,400 - Semi-finished product: nothing; - Product X (2,860 units): ¢ 33,088 - Product Y (45 units): ¢ 950 b) Purchases of the period: - Raw material A: 24,000 kg at ¢ 2.10 per kg; - Raw material B: 18,000 kg at ¢ 2.20 per kg; c) Expenses by nature: for greater simplification, expenses by nature are given through the indirect burden distribution table, which appears in the following section. d) Sales for the period: - Product X (14,000 units at ¢ 16.70 per unit): ¢ 233,800 - Product Y (2,000 units at ¢ 21.50 per unit): ¢ 43,000 It asks: 1) Accounting Entries 2) Balances in T Accounts 3) Statement of Manufacturing Costs 4) Income Statement 5) Balance Sheet
Case N ° 3
The industrial company Arica S.A. It treats a raw material A and a raw material B in Workshop 1. At the exit of this workshop a semi-finished or intermediate product is obtained that goes to the warehouse. This semi-finished product is treated again in Workshop 2, and when it leaves the finished products X and Y that enter the warehouse are produced.
Regarding its economic organization, the company is divided into the following activity centers (two auxiliary and four main), which allow control over indirect costs: Administration, Energy, Purchasing, Workshop 1, Workshop 2 and Sales.
I. Data common to general accounting and cost accounting:
The data that constitute the starting situation of Cost Accounting are:
a) Opening stocks:
- Raw material A (12,000 kg): ¢ 25,200
- Raw material B (36,000 kg): ¢ 95,400
- Semi-finished product: nothing;
- Product X (2,860 units): ¢ 33,088
- Product Y (45 units): ¢ 950
b) Purchases of the period:
- Raw material A: 24,000 kg at ¢ 2.10 per kg;
- Raw material B: 18,000 kg at ¢ 2.20 per kg;
c) Expenses by nature: for greater simplification, expenses by nature are given through the indirect burden distribution table, which appears in the following section.
d) Sales for the period:
- Product X (14,000 units at ¢ 16.70 per unit): ¢ 233,800
- Product Y (2,000 units at ¢ 21.50 per unit): ¢ 43,000
It asks:
1) Accounting Entries
2) Balances in T Accounts
3) Statement of
4) Income Statement
5)
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