Tomar Company produces vitamin energy drinks. The Mixing Department, the first processdepartment, mixes the ingredients required for the drinks. The following data are for April: Work in process, April 1 —Quarts started 90,000Quarts transferred out 75,000Quarts in EWIP 15,000Direct materials cost $ 84,000Direct labor cost $168,000Overhead applied $336,000 Direct materials are added throughout the process. Ending inventory is 60 percent complete withrespect to direct labor and overhead.Required:1. Why would a manager want a production report?2. Prepare a production report for the Mixing Department for April.
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.
Tomar Company produces vitamin energy drinks. The Mixing Department, the first process
department, mixes the ingredients required for the drinks. The following data are for April:
Work in process, April 1 —
Quarts started 90,000
Quarts transferred out 75,000
Quarts in EWIP 15,000
Direct materials cost $ 84,000
Direct labor cost $168,000
Overhead applied $336,000
Direct materials are added throughout the process. Ending inventory is 60 percent complete with
respect to direct labor and overhead.
Required:
1. Why would a manager want a production report?
2. Prepare a production report for the Mixing Department for April.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
