Consider the following data Work in process inventory December 31 7000 Work in process inventory January 1 9000 Purchases of raw material 63000 Raw Material inventory December 31 3000 Raw Material inventory January 1 9000 Direct Labor 12000 Total manufacturing overhead 6000 Calculate the cost of goods manufactured
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.
Consider the following data
Work in process inventory December 31
7000
Work in process inventory January 1
9000
Purchases of raw material
63000
Raw Material inventory December 31
3000
Raw Material inventory January 1
9000
Direct Labor
12000
Total manufacturing
6000
Calculate the cost of goods manufactured
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