The following information is available for the month of August from the Second department of the Twigg Corporation: Units Work in process, August 1 (60% complete) 50,000 Transferred from First Department in August 190,000 Work in process, August 30 (40% complete) 80,000 Materials are added at the end of the process in the Second department. Using the average cost method, what are the equivalent units of production for materials and conversion costs for the month of August? Materials Conversion 192,000 160,000 160,000 192,000 160,000 208,000 240,000 192,000
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.
|
Units |
|
| Work in process, August 1 (60% complete) |
50,000 |
| Transferred from First Department in August |
190,000 |
| Work in process, August 30 (40% complete) |
80,000 |
Materials are added at the end of the process in the Second department. Using the average cost method, what are the equivalent units of production for materials and conversion costs for the month of August?
|
Materials |
Conversion |
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