A company produces piastic kitehenware and uses process costing system. Products go through three departments - Mixing, Molding, ad Packaging. During the month of August, the following information is made available for the Mixing Department Units started Units completed and transferred Units in process, end (25% complete) 160,000 140,000 20,000 Materials are added at two points in the process. Material A is added at the beginning of the process and Material B when the units are 50% completed. Conversion costs are incurred uniformly throughout the mixing process. 25. The equivalent production for Material A а. 140,000 b. 145,000 с, 150,000 160,000
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.
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CHAP 10 #25
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