Finished Goods Work in Process Direct Materials Start of Year End of Year 25,000 160,000 15,000 During the year the following information was recorded: $75,000 Raw Materials Bought $10,000 Indirect Materials $125,000 Total Wages $80,000 Direct Labour $20,000 Indirect Labour 26,000 $160,000 Manufacturing Overhead 153,000 14,500 Balance was Sales and Administration
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.
The following information is available for ABC Company at the end of last year:
Instructions
A. Prepare a cost of goods manufactured schedule for last year.
B. Calculate the over- or under-applied manufacturing
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