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Carola Chemical Inc. Department 2 Cost of Production Report For The Month of December. 19

Department 2 received 55,000 liters from Department 1 at a cost of $1.80 per liter. It transferred 39,500 liters to Department 3 at a cost of $2.98 per liter and had 10,500 liters of work in process at the end of the month. There was a normal loss of 5,000 liters in production. The total cost accounted for in Department 2 was $142,000.

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817 views2 pages

Carola Chemical Inc. Department 2 Cost of Production Report For The Month of December. 19

Department 2 received 55,000 liters from Department 1 at a cost of $1.80 per liter. It transferred 39,500 liters to Department 3 at a cost of $2.98 per liter and had 10,500 liters of work in process at the end of the month. There was a normal loss of 5,000 liters in production. The total cost accounted for in Department 2 was $142,000.

Uploaded by

Melody Bautista
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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  • Cost of Production Report: Presents a detailed report on production costs, including schedules and breakdowns for the month of December.
  • Production Data Tables: Contains tabulated data for joint production costs and production details for various products.

2.

COST OF PRODUCTION REPORT - NORMAL LOSS: Cost Accounted for as Follows:


For December, the Production Control Department of Carola Transferred to next department (39,500 × $2.98) $117,710
Chemical, Inc., reported the following production data for
Department 2: Work in process - ending inventory:
Transferred in from Department 1 55,000 liters Cost from preceding department (10,500 ×
Transferred out to Department 3 39,500liters $20,790
$1.98)
In process at the end of December (with 1/2 labor and factory
Labor (10,500 × 1/3 × $0.64) 2,240
overhead) 10,500 liters
Factory overhead (10,500 × 1/3 × $0.36) 1,260 24,290
All materials were put into process in Department 1. The cost
-------- -------
department collected following figures for department 2:
Total cost accounted for $142,000
Unit cost for units transferred in from Dept 1 $1.80
======
Labor cost in department 2 $27,520
Applied factory overhead $15480 *Adjustment for lost units:

Formula for Calculation:


Carola Chemical Inc. (Cost from preceding departments / Units from preceding
Department 2 departments - Lost units) - Unit cost from preceding department
Cost of Production Report (99,000 / 50,000) - 1.80 = $0.18 OR
For the Month of December. 19____
(5,000 × 1.80) = $9,000 / 50,000 = $0.18

Quantity Schedule:    

Units received from preceding department   55,000

  ======

Units transferred to next department 39,500  

Units still in process (1/3 labor and overhead) 10,500

Units lost in process 5,000 55,000

  ------- ======

Cost Charged to the Department: Total CostUnit Cost

Cost from preceding department:    

     Transferred in during the month $99,000 $1.80

  -------- ------

Cost added by the department:    

     Labor [39,500 + (1/3 × 10,500) = 43,000 units] $27,520 $0.64

     Factory overhead $15,480 $0.36

  -------- ------

Total cost added $43,000 $1.00

Adjustment for lost units   $0.18*

  -------- ------

Total cost to be accounted for $142,000 $2.98

======= =====

   

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