LOLITA COMPANY Lolita Company has the following information available for June 2020: Beginning Work in Process Inventory (25% complete as to conversion) Started 20,000 units 130,000 units Ending Work in Process Inventory (75% complete as to conversion) 30,000 Units Beginning Work in Process Inventory Costs: Material P 4,400 Conversion 17,250 Current Period Costs: Material P 52,000 Conversion 82,500 All material is added at the start of production and all products completed are transferred out. 1. Prepare a cost of production report using FIFO method. 2. Prepare a cost of production report using weighted-average method.
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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