Costs per Equivalent Unit and Production Costs The following information concerns production in the Forging Department for November. All direct materials are placed into the process at the beginning of production, and conversion costs a incurred evenly throughout the process. The beginning inventory consists of $109,020 of direct materials. ACCOUNT Work in Process-Forging Department ACCOUNT NO. Balance Date Item Debit Credit Debit Credit Nov. 1 Bal., 7,900 units, 60% completed 118,026 30 Direct materials, 72,000 units 979,200 1,097,226 30 Direct labor 62,610 1,159,836 30 Factory overhead 86,450 1,246,286 30 Goods finished, 2 units ? 30 Bal., 6,300 units, 90% completed ? Based on the above data, determine each of the following amounts. If required, round your interim calculations to two decimal places. Round final answers (a-c) to the nearest dollar. a. Cost of beginning work in process inventory completed in November. b. Cost of units transferred to the next department during November.
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.
![Costs per Equivalent Unit and Production Costs
The following information concerns production in the Forging Department for November. All direct materials are placed into the process at the beginning of production, and conversion costs are
incurred evenly throughout the process. The beginning inventory consists of $109,020 of direct materials.
ACCOUNT Work in Process-Forging Department
ACCOUNT NO.
Balance
Date
Item
Debit
Credit
Debit
Credit
Nov.
1 Bal., 7,900 units, 60% completed
118,026
30 Direct materials, 72,000 units
979,200
1,097,226
30 Direct labor
62,610
1,159,836
30 Factory overhead
86,450
1,246,286
30 Goods finished, 2 units
?
30 Bal., 6,300 units, 90% completed
?
Based on the above data, determine each of the following amounts.
If required, round your interim calculations to two decimal places. Round final answers (a-c) to the nearest dollar.
a. Cost of beginning work in process inventory completed in November.
b. Cost of units transferred to the next department during November.
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