Using the information below, prepare a Cost of Production Report for CD Corporation's Packaging Department for May 2019 On May 1, 2019 the following were reported: Inventory In-Process-Packaging (5,500 units, 20% complete) Finished Goods (700 units at $7.25 a unit) 17,500 5,075 The following were charged to Work in Process- Packaging during May: Direct Materials transferred from Mixing 14,000 units @ $6.25 a unit. 87,500 12,000 4,800 Direct Labor Factory Overhead During May - 15,500 units were transferred to finished goods and 13,700 units were sold. On May 30 Inventory was as follows Inventory in Process- Packaging: 4,000 units (40% complete) Finished Goods - 2,500 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.
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