Aloha Company reported the following year-end information: Beginning work in process inventory $2,100,000 Beginning raw materials inventory 1,000,000 Ending work in process inventory 1,300,000 Ending raw materials inventory 500,000 Raw materials purchased 700,000 Direct labor 900,000 Manufacturing overhead 600,000 Aloha's Company's cost of goods manufactured for the year is O $3,300,000. O $2,600,000. O $2.700,000. O $3,500.000.
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.
Cost of goods manufactured = Total manufacturing costs + Beginning work in process inventory - Ending work in process inventory
where,
Total manufacturing costs = Material used + Freight in + Factory labor + Manufacturing overhead
Material used = Beginning material inventory + material purchases - Ending material inventory
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