I.A Corporation uses the weighted-average method in its process costing system. The Painting Department is the second department in its production process. The data below summarize the department’s operations in January. Units Percent Complete with Respect to Conversion Beginning work in process inventory................................... 7,100 70% Transferred in from the preceding department during January................................................................................ 61,000 Ending work in process inventory......................................... 4,600 30% The Painting Department’s cost per equivalent unit for conversion cost for January was Rs. 8.24. How much conversion cost was assigned to the units transferred out of the Painting Department during January?
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.
Question 5
I.A Corporation uses the weighted-average method in its
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|
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Units |
Percent Complete with Respect to Conversion |
|
|
Beginning work in process inventory................................... |
7,100 |
70% |
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|
Transferred in from the preceding department during January................................................................................ |
61,000 |
|
|
|
Ending work in process inventory......................................... |
4,600 |
30% |
The Painting Department’s cost per equivalent unit for conversion cost for January was Rs. 8.24.
How much conversion cost was assigned to the units transferred out of the Painting Department during January?
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