Morrison Company uses job-order costing to assign manufacturing costs to jobs. Its balance sheet on January 1 is as follows: Morrison Company Balance Sheet January 1 Assets Cash Raw materials Work in process Finished goods Prepaid expenses Property, plant, and equipment (net) Total assets Liabilities and Stockholders' Equity Accounts payable Retained earnings Total liabilities and stockholders' equity $ 11,900 5,900 20,550 $ 34,800 j. Cash sales to customers, $401,720. k. Cost of goods sold (unadjusted), $289,800. I. Cash payments to creditors, $77,200. m. Underapplied or overapplied overhead $?. 38,350 2,750 137,000 $ 212,900 $ 10,400 202,500 $ 212,900 During January the company completed the following transactions: a. Purchased raw materials on account, $90,800. b. Raw materials used in production, $93,6 ($78,600 was direct materials and $15,000 was indirect materials). c. Paid $195,100 of salaries and wages in cash ($110,200 was direct labor, $35,100 was indirect labor, and $49,800 was related to employees responsible for selling and administration). d. Various manufacturing overhead costs incurred (on account) to support production, $41,550. e. Depreciation recorded on property, plant, and equipment, $68,800 (70% related to manufacturing equipment and 30% related to assets that support selling and administration). f. Various selling expenses paid in cash, $39,800. g. Prepaid insurance expired, $1,700 (80% related to production, and 20% related to selling and administration). h. Manufacturing overhead applied to production, $141,000. i. Cost of goods manufactured, $293,800.

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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.