Following is a partial process cost summary for Mitchell Manufacturing's Canning Department. Direct Materials 96,000 Equivalent Units of Production Units Completed and transferred out Units in Ending Work in Process: Direct Materials (18,000 * 100%) Conversion (18,000 * 70%) Equivalent Units of Production Cost per Equivalent Unit Costs of beginning work in process Costs incurred this period Total costs Cost per equivalent unit 18,000 114,000 $ 42,800 143,300 $186,100 $ 1.63 per EUP Conversion 96,000 12,600 108,600 $ 62,900 192,700 $255,600 $ 2.35 per EUP If the units completed were transferred to the Labeling Department, what is the appropriate journal entry to transfer the conversion costs?
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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