Eagis Lid uses process costing in its Fabricating Department. At the beginning of October, it had 12,000 units in beginning work in process that were 40% complete with respect to conversion. During October, it put 87,000 units into production and completed 89,000 good units On October 31, there were 3,000 units in ending work in process that were 70% complete with respect to conversion Direct materials are added at the beginning of the process Inspection occurs at the end of the process, and normal spollage is 6% of good output Costs related to the beginning inventory were $36,800 for direct materials and $28,600 for conversion costs. During the month, the company issued $280,000 of direct materials and incurred $599,400 of conversion costs Assume Eagles uses the weighted-average method of process costing. What are the normal and abnormal spoilage units, respectively, for October? OA. 5,340 units, 1.660 units OB. 5,220 units, 1.780 units OC. 5,940 units, 1.060 units OD. 5.340 units; 1.780 units OE 7.000 units 1.660 units
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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