Question

Fresh Air Sdn Bhd manufactures vanilla bouquet air freshener through two consecutive processes M and N. It applies process costing principles in determining its costs. The data below relates to Process M for the month of May 2022: Process M Material input Direct labour Production overhead Normal loss Actual output Scrap value 15,000 kg@RM2 per kg 5,000 hours @ RM3 per hour RM2.43 per direct labour hour 5% of material input 14,000 kg RM0.20 per kg All output is fully completed in process M and transfer out to Process N. Required: a. Prepare Process M Account and show calculation of cost per unit. b. Prepare Normal loss Account c. Prepare Abnormal loss or Abnormal gain Account if any.

          Fresh Air Sdn Bhd manufactures vanilla bouquet air freshener through two consecutive processes M and N. It
applies process costing principles in determining its costs. The data below relates to Process M for the month of
May 2022:
Process M
Material input
Direct labour
Production overhead
Normal loss
Actual output
Scrap value
15,000 kg@RM2 per kg
5,000 hours @ RM3 per hour
RM2.43 per direct labour hour
5% of material input
14,000 kg
RM0.20 per kg
All output is fully completed in process M and transfer out to Process N.
Required:
a.
Prepare Process M Account and show calculation of cost per unit.
b.
Prepare Normal loss Account
c.
Prepare Abnormal loss or Abnormal gain Account if any.

Fresh Air Sdn Bhd manufactures vanilla bouquet air freshener through two consecutive processes M and N. It
applies process costing principles in determining its costs. The data below relates to Process M for the month of
May 2022:
Process M
Material input
Direct labour
Production overhead
Normal loss
Actual output
Scrap value
15,000 kg@RM2 per kg
5,000 hours @ RM3 per hour
RM2.43 per direct labour hour
5% of material input
14,000 kg
RM0.20 per kg
All output is fully completed in process M and transfer out to Process N.
Required:
a.
Prepare Process M Account and show calculation of cost per unit.
b.
Prepare Normal loss Account
c.
Prepare Abnormal loss or Abnormal gain Account if any.

Added by William A.

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