Exercise III Set B Timex Corporation produces a high-quality watches that passes through o production processes. The company uses the FIFO cost method. A quantity schedule for August for the first process follows: two Units to be accounted for: Work in process, August 1 (75% materials, 40% conversion cost added last month) Started this month Total units to be accounted for Units accounted for as follows: Transferred to the next process Work in process, August 31 (50% materials, 25% conversion cost added this month) Total units accounted for Required: Costs in the beginning work in process inventory were: Materials P114,000 Conversion cost 32,000 Costs added during August were: Materials Conversion cost 1. Quantity Schedule Note: use the table at the back 718,000 402,000 120 560 680 600 80 680 3. Compute the cost of completed goods and transferred out. 4. Compute the cost of work in process end.
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.
REQUIREMENT 3 and 4 obly
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