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Prepare t account of work-in-process

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Reference no: EM13256631

Mark TrucksLimited has some idle capacity in its plant, which is restored by accepting order from other automobiles industries. The company has finished assembly of 150 trucks against special order N, 13A from Western Motors Limited. The pertinent data are as under:

Started     October 3, 2008.Finished     November 2, 2008.

Departments                Material cost ($)       Labor hours         Rate per labor hours ($)
Assembly                               150,000                       4,500                         18                                
Painting                                  75,000                        1,200                          15
Finishing                                   45,000                      600                            12

Factory pay roll for the year is expected to amount $1,281,000.

Factory overhead for the year is estimated at $1776,000. Departmental break-up is provided below:

Departments       Pay rolls ($)       Factory over head ($)

Assembly                   972,000                    1296,000
Painting                     225,000                     375,000
Finishing                    84,000                      105,000

Factory overhead is based on direct labor hours. The component inventory has been supplied by Western Motors Limited. But the other material has been added by the company.

The agreed price to be charged is cost plus 20% mark-up, subject toa maximum charge of Rs.5, 000 Per truck.

Required:

1. Prepare a Job Cost Sheet for JobNo.13A,following proper format

2. Pass the necessary Journal entries and prepare T account of Work-In-Process.

3. Calculate Cost per unit.

4. Calculate Total gross profit.

Reference no: EM13256631

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