Costs per Equivalent Unit The following information concerns production in the Baking Department for December. All direct materials are placed in process at the beginning of production. ACCOUNT Work in Process—Baking Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Dec. 1 Bal., 24,000 units, 3⁄4 completed 116,700 31 Direct materials, 134,000 units 234,500 351,200 31 Direct labor 150,000 501,200 31 Factory overhead 375,000 876,200 31 Goods finished, 128,000 units 760,700 115,500 31 Bal., ? units, 1⁄2 completed 115,500 a. Based on the above data, determine each cost listed below. Round "cost per equivalent unit" answers to the nearest cent. 1. Direct materials cost per equivalent unit 2. Conversion cost per equivalent unit 3. Cost of the beginning work in process completed during December 4. Cost of units started and completed during December 5. Cost of the ending work in process
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
The following information concerns production in the Baking Department for December. All direct materials are placed in process at the beginning of production.
| ACCOUNT Work in Process—Baking Department | ACCOUNT NO. | |||||||
| Date | Item | Debit | Credit | Balance | ||||
| Debit | Credit | |||||||
| Dec. | 1 | Bal., 24,000 units, 3⁄4 completed | 116,700 | |||||
| 31 | Direct materials, 134,000 units | 234,500 | 351,200 | |||||
| 31 | Direct labor | 150,000 | 501,200 | |||||
| 31 | Factory |
375,000 | 876,200 | |||||
| 31 | Goods finished, 128,000 units | 760,700 | 115,500 | |||||
| 31 | Bal., ? units, 1⁄2 completed | 115,500 |
a. Based on the above data, determine each cost listed below. Round "cost per equivalent unit" answers to the nearest cent.
| 1. Direct materials cost per equivalent unit | |
| 2. Conversion cost per equivalent unit | |
| 3. Cost of the beginning work in process completed during December | |
| 4. Cost of units started and completed during December | |
| 5. Cost of the ending work in process |
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