raw material consumed
This query is : Resolved
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23 May 2011
MY COMPANY IS CALCULATING RAW MATERIAL CONSUMED BY USING THE FOLLOWING FORMULA:
OPENING WIP XX
ADD: RAW MATERIAL ISSUED XX
LESS: CLOSING WIP XX
IS THE ABOVE FORMULA CORRECT???
OPENING WIP XX
ADD: RAW MATERIAL ISSUED XX
LESS: CLOSING WIP XX
IS THE ABOVE FORMULA CORRECT???
23 May 2011
No the above formula is not correct.
It should be---
Op. Stock of Raw Materials+Purchase of Raw Materials-Cl. Stock of Raw Materials.
It should be---
Op. Stock of Raw Materials+Purchase of Raw Materials-Cl. Stock of Raw Materials.
Message likes :
3 times
23 May 2011
WIP has no relation with raw material consumed. You will just have to consider Op Stock of Raw Materials, Purchase and Cl. Stock of raw materials. Once Raw Materials are issued whether the same has been converted in finished goods or WIP it is not a matter. Just apply this formula---
Raw Mat Consumed=Op. Stock of Raw Materials+Purchase of Raw Materials-Cl. Stock of Raw Materials.
Raw Mat Consumed=Op. Stock of Raw Materials+Purchase of Raw Materials-Cl. Stock of Raw Materials.
23 May 2011
but sir this formula is being used in my company from a very very long time by an old ca.
further how can we ignore wip???
further how can we ignore wip???
23 May 2011
https://www.caclubindia.com/experts/finish-goods-raw-material-consupmtion-formula-363895.asp
Also see reply from above link.
Also see reply from above link.
24 May 2011
ok sir i have seen that but i want to know about the calculation of WIP
05 June 2011
The formula given is incomplete please bifurcate WIP into Material in process & Expenses in process and then use you will get the result
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