CMA Intermediate · Cost Accounting · Process Costing
Process A of Gupta Foods transfers 1,000 units at Rs 40 per unit to Process B. Process B adds Rs 12,000 of labour and overheads. Normal loss is nil and all 1,000 units are completed. What is the cost per unit of Process B output?
Process B output costs Rs 52 per unit. The transfer from Process A is Rs 40,000, added conversion cost is Rs 12,000, total Rs 52,000, and dividing by 1,000 completed units gives Rs 52.
- ARs 40
- BRs 52Correct
- CRs 12
- DRs 46
Explanation
Transferred cost = 1,000 x 40 = Rs 40,000. Add 12,000 gives Rs 52,000. Divided by 1,000 units, the cost per unit is Rs 52.
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