The work-in-process account for Department #2 for the month of December of the current year is presented below: Work in Process - Department #2 Beginning (1,200 units, 1⁄4 completed) - P1,200 Transferred out (6,200 units) ??? Transferred in from Department #1 (6,000 units) - 3,600 Direct labor - 8,000 Factory overhead - 4,800 Ending (1,000 units, 1⁄2 completed) - ??? No additional direct materials are added in Department #2. The department uses FIFO method. How much is the cost of goods transferred out? 12,800 17,660 16,000 13,000 How much is the cost of ending work in process? 1,600 600 2,600 1,000
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.
The work-in-process account for Department #2 for the month of December of the current year is presented below:
Work in Process - Department #2
Beginning (1,200 units, 1⁄4 completed) - P1,200 Transferred out (6,200 units) ???
Transferred in from Department #1 (6,000 units) - 3,600
Direct labor - 8,000
Factory
Ending (1,000 units, 1⁄2 completed) - ???
No additional direct materials are added in Department #2. The department uses FIFO method.
How much is the cost of goods transferred out?
12,800
17,660
16,000
13,000
How much is the cost of ending work in process?
1,600
600
2,600
1,000
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