Arabica Highland Coffee Company roasts and packs coffee beans. The process by placing coffee beands into the Roasting Department. From the Roasting Department, coffee beans are then transferred to the Packing Department. The following is a partial work in process account of the Roasting Dpeartment at July 31. Date Item Debit Credit Account No. Balance Debit Account No. Balance Credit July 1 Bal., 30,000 units, 10% completed 121,800 July 31 Direct materials, 155,000 units 620,000 741,800 July 31 Direct Labor 90,000 831,800 July 31 Factory overhead 33,272 865,072 July 31 Goods transferred, 149,000 units ? July 31 Bal., (?) units, 45% completed ?
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.
Arabica Highland Coffee Company roasts and packs coffee beans. The process by placing coffee beands into the Roasting Department. From the Roasting Department, coffee beans are then transferred to the Packing Department. The following is a partial work in process account of the Roasting Dpeartment at July 31.
| Date | Item | Debit | Credit |
Account No. Balance Debit |
Account No. Balance Credit |
| July 1 | Bal., 30,000 units, 10% completed | 121,800 | |||
| July 31 | Direct materials, 155,000 units | 620,000 | 741,800 | ||
| July 31 | Direct Labor | 90,000 | 831,800 | ||
| July 31 | Factory |
33,272 | 865,072 | ||
| July 31 | Goods transferred, 149,000 units | ? | |||
| July 31 | Bal., (?) units, 45% completed | ? |
in costing whenever the percentage of completion of goods in work in progress is given equivalent units of production are calculated and raw material for such work in progress is always taken to be in 100% of use.
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