1. The following information is available for Department A of B Manufacturing Corporation for the month of July: WIP, July 1, 30% complete 5,000 units Costs: Materials P12,000.00 DL P6,000.00 OH P8,000.00 Started in production during July 20,000 units Cost added: Materials P36,000.00 DL P16,000.00 OH P20,200.00 WIP, July 31, 20% complete 2,000 units Materials are added at the beginning of the process and the company uses the weighted average method to account for cost. Required: A. Cost of production report assuming the company utilizes FIFO method of accounting costs B. Cost of WIP ending, under WA C. Cost of WIP ending, under FIFO
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
1. The following information is available for Department A of B Manufacturing Corporation for the
month of July:
WIP, July 1, 30% complete 5,000 units
Costs:
Materials P12,000.00
DL P6,000.00
OH P8,000.00
Started in production during July 20,000 units
Cost added:
Materials P36,000.00
DL P16,000.00
OH P20,200.00
WIP, July 31, 20% complete 2,000 units
Materials are added at the beginning of the process and the company uses the weighted average
method to account for cost.
Required:
A. Cost of production report assuming the company utilizes FIFO method of accounting costs
B. Cost of WIP ending, under WA
C. Cost of WIP ending, under FIFO
D. Cost of goods transferred to finished goods, under WA
E. Cost of goods started and completed in July, under FIFO
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