Q-2 Following information related to Abbasi manufacturing company for the year ended December 31", 2007. Direct material Beginning Direct material Purchased Direct material Ending Rs.35,000 10,000 Direct material used Direct labor Conversion Cost 70,000 Factory overhead, 75% of 90% of DL Work in process ending Work in process beginning 200,000 COGM 950,000 1000,000 Manufacturing cost REQUIRED: Calculate all missing figures and also prepare Schedule for Cost of goods manufactured for the year ended December 31, 2007.
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.
Step by step
Solved in 4 steps
