Acton's August standard cost per meter is direct materials, $24, and conversion cost, $18. Acton has no direct materials variances. The following data apply to August manufacturing: Direct materials purchased Conversion costs incurred $540,000 Number of finished units manufactured $425,000 Number of finished units sold 19,000 18,000 1. Prepare summary journal entries for August (without disposing of under- or overallocated conversion costs). Acton has no direct materials variances. Required 2. Post the entries in requirement 1 to T-accounts for Materials and In-Process Inventory Control, Fin- Purchase of direct materials Completion of good finished units of product Sale of finished goods
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.
Backush costing and JIT production. The Acton Corporation manufactures electrical meters. For August, there were no beginning inventories of direct materials and no beginning or ending work in process. Acton uses a JIT production system and backush costing with three trigger points for making entries in the accounting system:
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