The following information concerns production in the Baking Department for August. All direct materials are placed in process at the beginning of production. Date Item Debit Credit Balance Debit Balance Credit August 1 Bal., 8,400 units, 2/5 completed 19,656 31 Direct materials, 151,200 units 302,400 322,056 31 Direct labor 88,540 410,596 31 Factory overhead 49,808 460,404 31 Goods finished, 153,300 units 444,402 16,002 31 Bal., ? units, 3/5 completed 16,002 a. Based on the above data, determine each cost listed below. Round "cost per equivalent unit" answers to the nearest cent. Line Item Description Amount 1. Direct materials cost per equivalent unit 2. Conversion cost per equivalent unit 3. Cost of the beginning work in process completed during August 4. Cost of units started and completed during August 5. Cost of the ending work in process
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.
The following information concerns production in the Baking Department for August. All direct materials are placed in process at the beginning of production.
Date |
Item |
Debit |
Credit |
Balance Debit |
Balance Credit |
|---|---|---|---|---|---|
| August 1 | Bal., 8,400 units, 2/5 completed | 19,656 | |||
| 31 | Direct materials, 151,200 units | 302,400 | 322,056 | ||
| 31 | Direct labor | 88,540 | 410,596 | ||
| 31 | Factory |
49,808 | 460,404 | ||
| 31 | Goods finished, 153,300 units | 444,402 | 16,002 | ||
| 31 | Bal., ? units, 3/5 completed | 16,002 |
a. Based on the above data, determine each cost listed below. Round "cost per equivalent unit" answers to the nearest cent.
| Line Item Description | Amount |
|---|---|
| 1. Direct materials cost per equivalent unit | |
| 2. Conversion cost per equivalent unit | |
| 3. Cost of the beginning work in process completed during August | |
| 4. Cost of units started and completed during August | |
| 5. Cost of the ending work in process |
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