The plant manager of Integrity Products Co. gathered production statistics for October as follows: Beginning work in process : 8,000 units (all materials but only ½ converted) Materials cost- P7,968 Conversion cost- P8,592 Placed in Process, October: 40,000 units Materials cost- P48,000 Conversion cost- P72,720 Completed and transferred to finished goods during October- 42,000 units Ending work in process- 6,000 units (all materials, 3/5 incomplete) Using FIFO method, determine the total cost of completed units.
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 plant manager of Integrity Products Co. gathered production statistics for October as follows:
Beginning work in process : 8,000 units (all materials but only ½ converted)
Materials cost- P7,968
Conversion cost- P8,592
Placed in Process, October: 40,000 units
Materials cost- P48,000
Conversion cost- P72,720
Completed and transferred to finished goods during October- 42,000 units
Ending work in process- 6,000 units (all materials, 3/5 incomplete)
Using FIFO method, determine the total cost of completed units.
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