Reference no: EM132549204
The following information pertains to the goods in process in Process No. 02 of Shoen Leather Products (SLP) during the month of June, 2018. The firm is engaged in making leather jackets. The overall production activity of SLP is divided in four production processes, and it is considered as production on mass level and goods are manufactured for different clients simultaneously.
Manufacturing Costs incurred in June, 2018 :
Raw materials used 340,000
Direct Labor 275,000
Factory overhead 255,000
Production Report for June, 2018 :
Units
Units received from Process No. 01 50,000
Units completed and transferred to Process No. 03 45,000
Units in process, June 30, 2018 (90% done as to material
And 70% done as to Labor and Factory Overhead) 4,000
Required :
Question (a) make a COST OF PRODUCTION REPORT.
Question (b) The firm cannot follow Job Order costing system to ascertain cost of production. Justify this statement by giving two valid reasons.