Chapman Manufacturing Company uses the weighted average method for process costing. Chapman produces processed food products that pass through three sequential departments. The costs for Department 1 for February 20X5 were as follows: Cost of beginning inventory: Material 11,750 20,186 $31,936 Conversion Costs added in Department 1 during February: Direct material $338,620 320,350 266,590 $925,560 Direct labor Manufacturing overhead Department 2 handled the following units during February: Units in process, February 1 Units started in Department 1 Units transferred out to Department 2 Units in process, February 28 3,000 48,000 47,000 4,000 On average, the February 1 units were 30% complete, and the February 28 units were 60% complete. Materials are added at the beginning of the process and conversion costs occur evenly throughout the process in Department 1. Prepare the product cost report for February for Department 1. Beg Inventory Started Total ..............
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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