# Cost of production report (CPR) questions and answers

Written by True Tamplin, BSc, CEPF®
Updated on June 29, 2021

## Question No. 1

The MST Manufacturing Company produces one product that passes through just one process in a manufacturing cycle lasting approximately 18 days. Therefore, there will generally be some work in process inventories at the end of each month.

After MST started its manufacturing operations on 1st January, the costs of production for the rest of the month are given as follows:

 Materials \$41,412 Labor \$32,054 Factory Overhead \$24,552

The production statistics for the month were:

 Units completed and transferred to finished goods store 6,500 Units in Process (materials 40% and labor and overhead 25%) 1,600

Required: Prepare a statement showing the equivalent production quantity for the month in terms of materials, labor, and factory overhead. Also, prepare a cost of production report.

### Solution:

MTS Manufacturing Company
Cost of Production Report
For the month of January 20….

Computation:
Formula: Units completed & transferred out + Units in process only completed portion.

## Question No. 2

The Tuttni Corporation manufactures one product that passes through two manufacturing departments. Production and manufacturing costs for the month of April were as follows:

Required:

Using the process costing system, prepare a cost of production report for the month.

### Solution:

The Tuttni Corporation
Cost of Production Report
For the Month of April 20…

W.I.P ending inventory:

Computation

Equivalent/Effective Production

Department I

Material = 9,400 + 600 x 50/100 = 9,700 units
Labor = 9,400 + 600 x 50/100 = 9,700 units
FOH = 9,400 + 600 x 50/100 = 9,700 units

Department II

Material = 9,400 + 0 = 9,400 units
Labor = 9,400 + 0 = 9,400 units
FOH = 9,400 + 0 = 9,400 units