Beginning work in process inventory: Units in beginning work in process inventory 600 Materials costs $ 7,000 Conversion costs $ 2,300 Percent complete with respect to materials 55 % Percent complete with respect to conversion 25 % Units started into production during the month 6,500 Units transferred to the next department during the month 5,700 Materials costs added during the month $ 110,100 Conversion costs added during the month $ 83,200 Ending work in process inventory: Units in ending work in process inventory 1,400 Percent complete with respect to materials 70 % Percent complete with respect to conversion 55 % The cost of ending work in process inventory in the first processing department according to the company's cost system is closest to: $23,674 $30,130 $27,355 $43,043
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.
| Beginning work in process inventory: | |||
| Units in beginning work in process inventory | 600 | ||
| Materials costs | $ | 7,000 | |
| Conversion costs | $ | 2,300 | |
| Percent complete with respect to materials | 55 | % | |
| Percent complete with respect to conversion | 25 | % | |
| Units started into production during the month | 6,500 | ||
| Units transferred to the next department during the month | 5,700 | ||
| Materials costs added during the month | $ | 110,100 | |
| Conversion costs added during the month | $ | 83,200 | |
| Ending work in process inventory: | |||
| Units in ending work in process inventory | 1,400 | ||
| Percent complete with respect to materials | 70 | % | |
| Percent complete with respect to conversion | 55 | % |
The cost of ending work in process inventory in the first processing department according to the company's cost system is closest to:
|
$23,674
|
||
|
$30,130
|
||
|
$27,355
|
||
|
$43,043
|
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