Reference no: EM132569010

Question 1: Prepare the cost the reconciliation statement for the question below:

Ltd manufactures a range of products and the data below refer to oneproduct which goes through one process only. The company operates a 13 four-weekly reporting systemfor process and products costs and the data given below relate to Period 10.

There was no opening WIP stock.

5,000 units of materials input at ?2.94 per unit entered the process.

Further direct materials added ?13,830

Direct wages incurred ? 6,555

Production overhead ? 7,470

Normal loss is 3% of input.

Closing WIP was 800 units but these were incomplete, having reached the followingpercentages of completion for each of the elements of cost listed:

Further direct materials added 75 %

Direct wages incurred 50 %

Production overhead 25 %

270 units were scrapped after a quality control check when the units were at the followingdegrees of completion.

Further direct materials added 66 2/3 %

Direct wages incurred 33 1/3 %

Production overhead 16 2/3 %

Units scrapped, regardless of the degree of completion, are sold for ?1 each and it is company policy to credit the process account with the scrap value of normal loss units.