Standard-costing with beginning and ending work in process. Lawrence Company is a manufac- turer of contemporary door handles. The vice president of Design attends home shows twice a year so the company can keep current with home trends. Because of its volume, Lawrence uses process costing to account for production. Costs and output figures for August are as follows: Lawrence Company's Process Costing for the Month Ended August 31, 2017 Units Direct Materials Conversion Costs $ 5.75 $ 86,250 Standard cost per unit 12.25 $ 55,125 Work in process, beginning inventory (Aug. 1) Degree of completion of beginning work in process Started in August Completed and transferred out Work in process, ending inventory (Aug. 31) Degree of completion of ending work in process Total costs added during August 15,000 100% 30% 100,000 95,000 20,000 100% 80% $569,000 $1,307,240
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.
Compute equivalent units for direct materials and conversion costs. Show physical units in the first column of your schedule
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 4 images
