1. Production cost report is the combination of statement of cost and statement of evaluation. Just format is changed.
2. If in question transfer include than s separate column is required for transfer this transfer can be from different sources.
3. For clean conception total amount of spoilage determine at first than total amount of spoilage distributed among the ratio by which they are distributed.
4. If spoiled units given in question than abnormal spoilage = Spoiled unit–Normal spoilage process costing.
5. If total input of physical unit less equivalent unit after determining abnormal loss or spoilage than the missing figure would be consider as lost in unit this unit not entered intoequivalent unit of different cost.
6. Total cost transferred out must be transferred to the next process or department if two or more department or process given in the question. Here total cost transferred out =Completed unit + Cost of opening inventory + Normal spoilage.
7. If spoilage occur after inspection or end of process than spoilage not needed to be distribute . Only shown in production cost report normally. If spoilage detected at the end ofthe year than we consider work 100% complete.
8. If inspection occurred after 50 percent completing to the next process or department than normal spoilage unit come to transferred in cost unit not materials unit.
9. If degree of completion is not segregate for ending inventory than units of ending inventory entered into transferred unit and other unit but not materials for next process.
10. If unit completed and ending inventory given together in question than units of ending inventory entered into materials column 100%.
11. If lost in unit given in question than its consider as normal spoilage and this unit entered each column of equivalent unit.
12. Production cost means conversion cost. If in question direct labor or labor and factory o/h given than its consider as conversion cost or we consider and overhead separately.
13. If degree of completion is not given for ending inventory than we consider work completed 100%.
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