reform, Incorporated, uses the FIFO method in its process costing system. It manufactures a product that passes through two partments. Data for a recent month for the first department follow work in process inventory, beginning nits started in process Units transferred out work in process inventory, ending Cost added during the month Units 86,000 814,000 820,000 80,000 Equivalent units of production Cost per equivalent unit Materials Materials $ 70,200 $ 1,798,200 $ 398,058 $ 437,855 e beginning work in process inventory was 80% complete with respect to materials and 65% complete with respect to labor and erhead. The ending work in process inventory was 60% complete with respect to materials and 40% complete with respect to labor d overhead quired: Compute the first department's equivalent units of production for materials, labor, and overhead for the month. Compute the first department's cost per equivalent unit for materials, labor, overhead, and in total for the month. (Round your aswers to 2 decimal places.) Labor Labor $ 39,600 Overhead Overhead $ 53,000 Total
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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![Exercise 5S-7 (Algo) Equivalent Units of Production and Cost per Equivalent Unit-FIFO Method [LO 5S-6,
LO 5S-7]
Pureform, Incorporated, uses the FIFO method in its process costing system. It manufactures a product that passes through two
departments. Data for a recent month for the first department follow
Work in process inventory, beginning
Units started in process
Units transferred out
Work in process inventory, ending
Cost added during the month
Units
86,000
814,000
820,000
80,000
1. Equivalent units of production
2. Cost per equivalent unit
Materials
Materials
$ 70,200
$ 1,798,200
$ 437,855
The beginning work in process inventory was 80% complete with respect to materials and 65% complete with respect to labor and
overhead. The ending work in process inventory was 60% complete with respect to materials and 40% complete with respect to labor
and overhead.
Labor
Required:
1 Compute the first department's equivalent units of production for materials, labor, and overhead for the month.
2. Compute the first department's cost per equivalent unit for materials, labor, overhead, and in total for the month (Round your
answers to 2 decimal places.)
Labor
$ 39,600
Overhead
$398,050
Total
Overhead
$ 53,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fad2a539d-bb47-4eed-bc0e-d796c95bfe57%2F45712a36-798c-43b4-ba6a-4e05a7ae491a%2Fqmxutw_processed.jpeg&w=3840&q=75)
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