Step 1
Production Statement for the year ended 31 March 2013
Direct Material | Note 1 | N$ 350,000 |
Direct Labour | N$ 70,000 | |
indirect labour | N$ 120,000 | |
Production Overhead | Note 2 | N$ 236,200 |
Total Production Cost | N$ 776,200 | |
Less unfinished production | N$ 50,000 | |
Production cost of Finished Units produced | N$ 726,200 |
Note 1
Direct Material
Opening stock Nil
Purchases N$ 360,000
Less closing stock N$ 10,000
Raw material consumed N$ 350,000
Note 2
Production overhead
Factory maintenance cost N$ 43,000
Cleaning supplies ( 1200 +7000-2000) N$ 6,200
Rental cost (20% of 75,000) N$ 15,000
Plant Insurance N$ 8,000
Depreciation Plant N$ 100,000
Power and Lighting (80% of 80,000) N$ 64,000
Total N$ 236,200
Note 3
All other expenses have been ignored since those were not related to production .
Step 2
Number of units produce
Units sold 32,000
Closing stock of batteries unsold 8,000
Total units produced 40,000
Step 3
Cost of producing one unit
Total cost of production N$ 726,200
Total Units produced 40,000
Cost of producing one unit N$ 18.15
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