Definition and explanation

The cost of production report (CPR) is a document used in process costing device that summarizes the information around the circulation of units and costs v the work in procedure account of a processing department. That is equal to the job expense sheet all set in a job order costing system. A separate expense of manufacturing report is all set for each processing department.

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The cost of manufacturing report is thought about a crucial management document because it offers managers v the following an essential information about production and also cost that a handling department:

The variety of units moved in and also transferred out by a department throughout the month.The greatest production cost amongst materials, labor and manufacturing overhead.The influence of a recent development in production process on every unit price in a handling department.A significant change in every unit expense due come unexpected change in one or much more cost elements like direct materials, straight labor and manufacturing overhead.The hurdles or limiting factors present in one or more processing departments that could potentially annoy the in its entirety output effectiveness of the firm.

Other names provided for expense of manufacturing report room production cost report and also production report.

Sections or components of a expense of manufacturing report

A cost of production report is composed of the adhering to three sections/parts:

Quantity schedule sectionCost per equivalent unit sectionCost reconciliation section

Let’s briefly explain the function of every section.

1. Quantity schedule section

Quantity schedule is the an initial section that a cost of manufacturing report. This ar summarizes the flow of physical units with the relevant processing department and shows the equivalent units because that materials and conversion costs. The portion of completion of any kind of units in occupational in process beginning and also ending list is additionally shown in this section. The quantity schedule additionally guides in prepare the various other two part of the expense of production report.

2. Cost per indistinguishable unit section

In this section, the price per identical unit is computed. Under weighted median method, that is excellent by splitting the total of beginning inventory cost and cost added during the duration by the tantamount units of production computed under weighted typical method. Click here to read exactly how equivalent systems of manufacturing are computed making use of weighted average method.

3. Cost reconciliation section

In this section, the price charged to the department is reconciled or accounted for. Usually, the complete cost fee to a department consists of the following:

Cost of start work in procedure inventoryMaterials, job overhead prices incurred by the department during existing periodCost transferred in from coming before department throughout the period

The full of over costs is accounted for by computer the following amounts:

Cost that units transferred to the next department or finished items storeroom.Cost in ending work in process inventory.


The Jessica company produces a product supplied to clean mirrors and head lamp of vehicles. The company uses a procedure costing and has two handling departments – department X and department Y. The handling starts in room X wherein three different chemicals are combined together in equal proportions. After mix in department X, the partly completed units are transferred to department Y. The complying with data has been take away from department X.

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Required: Using over data, all set a price of production report of department X for the month of January.