J & G Manufacturing makes a single product by way of three separate processes. Details of production for the month ending June 30 were as follows: Process Process 1 Process 2 Process 3 Input material: 16,250 kg $390,000 - - Material added - $36,750 - Direct Labour cost $57,300 $92,200 $112,800 Manufacturing Overhead $61,000 $63,000 $97,080 Normal losses 8% 6% 6% Output 13,750 kg 13,250 kg 12,000 kg Scrap value of losses - $16.00/kg $32.00/kg The nature of the process requires equipment to be cleaned at the end of each month; hence there is no opening or closing stock of the product in the process. Required: The process account for each process: and The abnormal loss/gain account(s) showing J & G Manufacturing true loss/gain.
J & G Manufacturing makes a single product by way of three separate processes. Details of production for the month ending June 30 were as follows: Process Process 1 Process 2 Process 3 Input material: 16,250 kg $390,000 - - Material added - $36,750 - Direct Labour cost $57,300 $92,200 $112,800 Manufacturing Overhead $61,000 $63,000 $97,080 Normal losses 8% 6% 6% Output 13,750 kg 13,250 kg 12,000 kg Scrap value of losses - $16.00/kg $32.00/kg The nature of the process requires equipment to be cleaned at the end of each month; hence there is no opening or closing stock of the product in the process. Required: The process account for each process: and The abnormal loss/gain account(s) showing J & G Manufacturing true loss/gain.
J & G Manufacturing makes a single product by way of three separate processes. Details of production for the month ending June 30 were as follows: Process Process 1 Process 2 Process 3 Input material: 16,250 kg $390,000 - - Material added - $36,750 - Direct Labour cost $57,300 $92,200 $112,800 Manufacturing Overhead $61,000 $63,000 $97,080 Normal losses 8% 6% 6% Output 13,750 kg 13,250 kg 12,000 kg Scrap value of losses - $16.00/kg $32.00/kg The nature of the process requires equipment to be cleaned at the end of each month; hence there is no opening or closing stock of the product in the process. Required: The process account for each process: and The abnormal loss/gain account(s) showing J & G Manufacturing true loss/gain.
J & G Manufacturing makes a single product by way of three separate processes. Details of production for the month ending June 30 were as follows:
Process
Process 1
Process 2
Process 3
Input material: 16,250 kg
$390,000
-
-
Material added
-
$36,750
-
Direct Labour cost
$57,300
$92,200
$112,800
Manufacturing Overhead
$61,000
$63,000
$97,080
Normal losses
8%
6%
6%
Output
13,750 kg
13,250 kg
12,000 kg
Scrap value of losses
-
$16.00/kg
$32.00/kg
The nature of the process requires equipment to be cleaned at the end of each month; hence there is no opening or closing stock of the product in the process.
Required:
The process account for each process: and
The abnormal loss/gain account(s) showing J & G Manufacturing true loss/gain.
Definition Definition Indirect costs incurred while producing goods or services. Overhead costs cannot be directly attributed to products or services. Overhead includes indirect material cost, indirect labor cost, rent, utilities expenses, and depreciation. Since these costs directly affect the profitability of a company, managing overhead becomes an important task for management.
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