Lights Incorporated calculates cost for an equivalent unit of production using the weighted-average method. Data for July: Work-in-process inventory, July 1 (39,500 units): Direct materials (93% completed) Conversion (57% completed) Balance in work in process inventory, July 1 Units started during July Units completed and transferred Work-in-process inventory, July 31: Direct materials (93% completed) Conversion (57% completed) Cost incurred during July: Direct materials Conversion costs $ 122,750 77,200 $ 199,950 93,500 108,300 24,700 $ 183,500 291,500 Total equivalent units for materials under the weighted-average method are calculated to 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.
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