Question

how do you treat opening stock of WIP in cost sheet?​

Answer 1

Answer:

The value of opening stock of work in progress should be added to year's production cost, and the value of closing stock of work in progress should be deducted from it to arrive at the correct cost of goods manufactured for the year.

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Answer 2

The treatment of opening stock of WIP in cost sheet is as follows:

• The opening WIP inventory cost relates to the asset component of the balance sheet from the prior accounting period.
• Determine the closing WIP inventory from the previous period and carry it over as the opening figure for the current financial period to compute the opening WIP inventory.
• The cost of the year's production should include the value of the opening stock of work-in-progress.