QUESTION 5 !Khaos Limited manufactures a single product. Production cost information for its first year of operation, appears below: Units manufactured Units sold Direct labour Direct materials Variable overheads Fixed overheads 80 000 units 64 000 units R40 per unit R16 per unit R1 200 000 R4 400 000

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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QUESTION 5
!Khaos Limited manufactures a single product. Production cost information for its first year of operation,
appears below:
Units manufactured
Units sold
Direct labour
Direct materials
Variable overheads
Fixed overheads
REQUIRED:
5.1
5.1.1
5.1.2
5.1.3
5.2
80 000 units
64 000 units
R40 per unit
R16 per unit
R1 200 000
R4 400 000
Determine, under both the absorption and variable costing methods, the -
production cost per unit;
profit for the year at a selling price of R180 per unit;
cost of closing inventory.
Reconcile the profits calculated in 5.1.3.
Transcribed Image Text:QUESTION 5 !Khaos Limited manufactures a single product. Production cost information for its first year of operation, appears below: Units manufactured Units sold Direct labour Direct materials Variable overheads Fixed overheads REQUIRED: 5.1 5.1.1 5.1.2 5.1.3 5.2 80 000 units 64 000 units R40 per unit R16 per unit R1 200 000 R4 400 000 Determine, under both the absorption and variable costing methods, the - production cost per unit; profit for the year at a selling price of R180 per unit; cost of closing inventory. Reconcile the profits calculated in 5.1.3.
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