Production information shows the following costs and units for the smoothing department in August. Cost Units Work in process Beginning balance: materials $1,550 Beginning units 640 Beginning balance: conversion 2,700 Transferred in 1,810 Materials 7,760 Transferred out 1,870 Labor 14,510 Overhead 6,890 All materials are added at the beginning of the period. The ending work in process is 10% complete as to conversion. What is the value of the inventory transferred to finished goods and the value of the WIP inventory at the end of the month?
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.
Production information shows the following costs and units for the smoothing department in August.
| Cost | Units | ||||
| Work in process | |||||
| Beginning balance: materials | $1,550 | Beginning units | 640 | ||
| Beginning balance: conversion | 2,700 | Transferred in | 1,810 | ||
| Materials | 7,760 | Transferred out | 1,870 | ||
| Labor | 14,510 | ||||
| Overhead | 6,890 |
All materials are added at the beginning of the period. The ending work in process is 10% complete as to conversion. What is the value of the inventory transferred to finished goods and the value of the WIP inventory at the end of the month?
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