ECR Exam Dec 2007 Q 1.3 - work in progress

emmag
emmag Registered Posts: 35 ? ? ?
Help!

In the previous question you are asked to work out the total direct labour cost which I understand and got £3,800.

Then the additional data is:-

Opening work in progress Nil
Finished output to next process 7,000
Closing Work in progress 1,200
Degree of completetion - direct materials 100%
Degree of completetion - direct labour 50%

I've got the answer of £0.50 but I don't understand it. Why is the 50% bit of information used? What does the 100% mean?

Comments

  • rachy1975
    rachy1975 Registered Posts: 366
    emmag wrote: »
    Help!

    In the previous question you are asked to work out the total direct labour cost which I understand and got £3,800.

    Then the additional data is:-

    Opening work in progress Nil
    Finished output to next process 7,000
    Closing Work in progress 1,200
    Degree of completetion - direct materials 100%
    Degree of completetion - direct labour 50%

    I've got the answer of £0.50 but I don't understand it. Why is the 50% bit of information used? What does the 100% mean?

    the 50% is your closing work in process so 50% of 1200 is added onto your finished work. 100% is just telling you that all the material is complete but that part of the process is not finished as only 50% of the labour process is finished
  • lori
    lori Registered Posts: 25 Dedicated contributor ? ? ?
    divide the 3,800 by 7600 = .50p

    100% finished goods = 7000 complete to next process
    50% mean half complete closing work in progess = 1200/2(eg 50%)
    gives you the 7600
    think is right
    lori:001_smile:
  • A-Vic
    A-Vic Registered Posts: 6,970
    lori wrote: »
    divide the 3,800 by 7600 = .50p

    100% finished goods = 7000 complete to next process
    50% mean half complete closing work in progess = 1200/2(eg 50%)
    gives you the 7600
    think is right
    lori:001_smile:

    Looks right to me :thumbup1:
Privacy Policy