Diamond Inc. manufactures jewelry. The company has two departments, Assembly and Polishing. For the Polishing Department, material is added when the process is 80% complete. Work happens evenly throughout the process, so Conversion Costs are added evenly to the product. Once assembly is complete, the jewelry pieces are immediately transferred to the Polishing Department. Once the polishing is complete, the final product is transferred to Finished Goods Inventory. Data for the Polishing Department is as follows: Equiv Units Ending Equiv Units Open WIP New Costs Transferred-In 200 60 $250 $15,050 Direct Materials 140 - $500 $1,500 Conversion Costs 182 42 $1,250 $4,000 Actual units Ending Inventory 60 Units Transferred out 140 Provide calculations in good form for the costs per equivalent units and the total cost reconciliation for the department. If Diamond Inc. makes use of individual WIP accounts for the Polishing Department - one each for Transferred-In (if applicable), Direct Materials, and Conversion Costs - provide the general journal entry to show transfer of completed items to Finished Goods Inventory.
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.
Diamond Inc. manufactures jewelry. The company has two departments, Assembly and Polishing. For the Polishing Department, material is added when the process is 80% complete. Work happens evenly throughout the process, so Conversion Costs are added evenly to the product. Once assembly is complete, the jewelry pieces are immediately transferred to the Polishing Department. Once the polishing is complete, the final product is transferred to Finished Goods Inventory. Data for the Polishing Department is as follows:
| Equiv Units | Ending Equiv Units | Open WIP | New Costs | |
| Transferred-In | 200 | 60 | $250 | $15,050 |
| Direct Materials | 140 | - | $500 | $1,500 |
| Conversion Costs | 182 | 42 | $1,250 | $4,000 |
| Actual units | ||||
| Ending Inventory | 60 | |||
| Units Transferred out | 140 |
Provide calculations in good form for the costs per equivalent units and the total cost reconciliation for the department.
If Diamond Inc. makes use of individual WIP accounts for the Polishing Department - one each for Transferred-In (if applicable), Direct Materials, and Conversion Costs - provide the general
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