uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 30,000 units. The costs and percentage completion of these units in beginning inventory were: Costs of Beginning Inventory & %-Complete - Material $92,000 100% - Conversion 58,000 60% A total of 420,000 units were started and 370,000 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month: - Material Cost: $851,000 - Conversion Cost : 995,000
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.
uses the weighted-average method in its
Costs of Beginning Inventory & %-Complete
- Material $92,000 100%
- Conversion 58,000 60%
A total of 420,000 units were started and 370,000 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month:
- Material Cost: $851,000
- Conversion Cost : 995,000
The ending inventory was 50% complete with respect to materials and 25% complete with respect to conversion costs.
Compute the following:
EU of Material ________________________
EU of Conversion ________________________
Cost per EU of Material ____________________
Cost per EU of Conversion __________________
Value of COGs Mfg’d. (Transferred Out) ____________
What is the value of ending inventory and detail the proof of that amount.
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