The inventory at June 1 and costs charged to Work in Process - Department 60 during June are as follows: 3,800 units, 80% completed P 60,400 Direct materials, 32,000 units 368,000 Direct labor 244,000 Factory overhead 188,000 Total cost to be accounted for P860,400 During June, 32,000 units were placed into production and 31,200 units were completed, including those in inventory on June 1. On June 30, the inventory of work in process consisted of 4,600 units which were 40% completed. Inventories are costed by the first-in, first-out method and all materials are added at the beginning of the process. Determine the following, presenting your computations: (a) equivalent units of production for conversion cost (b) conversion cost per equivalent unit (c) total and unit cost of finished goods started in prior period and completed in the current period
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 inventory at June 1 and costs charged to Work in Process - Department 60 during June are as follows:
|
3,800 units, 80% completed |
P 60,400 |
|
Direct materials, 32,000 units |
368,000 |
|
Direct labor |
244,000 |
|
Factory overhead |
188,000 |
|
Total cost to be accounted for |
P860,400 |
During June, 32,000 units were placed into production and 31,200 units were completed, including those in inventory on June 1. On June 30, the inventory of work in process consisted of 4,600 units which were 40% completed. Inventories are costed by the first-in, first-out method and all materials are added at the beginning of the process.
Determine the following, presenting your computations:
|
(a) |
equivalent units of production for conversion cost |
|
(b) |
conversion cost per equivalent unit |
|
(c) |
total and unit cost of finished goods started in prior period and completed in the current period |
|
(d) |
total and unit cost of finished goods started and completed in the current period |
|
(e) |
total cost of work in process inventory at June 30 |
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
