ricket paddles. It has two departments that process all products. During July, the beginning work in process in the Dept 1 was half completed as to conversion, and complete as to direct materials. The beginning inventory included $40,000 for materials and $60,000 for conversion costs. Ending work-in-process inventory in the Dept 1 was 40% complete. Direct materials are added at the beginning of the process. Beginning work in process in the Dept 2 was 80% complete as to conversion. Direct materials for Dept 2 the units are added near the end o
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.
a. Compute for the unit cost of transferred unit for dept 2 using average
b. compute for the cost of work in process, ending using average method
Lexington Company produces baseball bats and cricket paddles. It has two departments that process all products. During July, the beginning work in process in the Dept 1 was half completed as to conversion, and complete as to direct materials. The beginning inventory included $40,000 for materials and $60,000 for conversion costs. Ending work-in-process inventory in the Dept 1 was 40% complete. Direct materials are added at the beginning of the process. Beginning work in process in the Dept 2 was 80% complete as to conversion. Direct materials for Dept 2 the units are added near the end of the process. Beginning inventories included $24,000 for transferred-in costs and $28,000 for conversion costs. Ending inventory was 30% complete. Additional information about the two departments follows
| Dept 1 | finishing | |
|
Transferred out cost |
128,000 | 68,500 |
| conversion Cost | 28,000 | 68,500 |
| Materials added | 48,000 | 34,000 |
| WIP, beg units | 20,000 | 24,000 |
| units started this period | 60,000 | 68,000 |
| units transferred this period | 64,000 | 20,000 |
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