Exercise 8-25 (Static) Compute Equivalent Units: FIFO Method (LO 8-5) The following data are taken from the production records at Plant #2 of GP Industries for March. Work-in-process beginning inventory consisted of 10,000 units fully complete with respect to materials and 30 percent complete with respect to conversion costs. In March, the plant started 80,000 units and transferred out 70,000 units. The work-in-process inventory was fully complete with respect to materials and 70 percent complete with respect to conversion costs. Suppose that GP Industries uses FIFO process costing at Plant #2 for product costing. Required: The following equivalent units (materials; conversion) used to compute production costs for March, would be
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.
Exercise 8-25 (Static) Compute Equivalent Units: FIFO Method (LO 8-5)
The following data are taken from the production records at Plant #2 of GP Industries for March. Work-in-process beginning inventory consisted of 10,000 units fully complete with respect to materials and 30 percent complete with respect to conversion costs. In March, the plant started 80,000 units and transferred out 70,000 units. The work-in-process inventory was fully complete with respect to materials and 70 percent complete with respect to conversion costs.
Suppose that GP Industries uses FIFO
Required:
The following equivalent units (materials; conversion) used to compute production costs for March, would be:
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
