Water Goggles Shaping Department Month Ended January 31. Flow of Production Units to account for: Beginning work in process, January 1 Started in production during January Total physical units to account for Units accounted for: Shaping Department Equivalent Units Step 1 Flow of Production Flow of Completed and transferred out during January Ending work in process, January 31 14,000 Total physical units accounted for 62,000 Total equivalent units *14,000 units each 33% complete = 4,620 equivalent units Physical Units Ending work in process, January 31 0 Total equivalent units 62,000 62,000 48,000 Completed and transferred out during January Step 2 Equivalent Units Direct Materials 48,000 14,000 62,000 The direct materials are added at the beginning of the process, but conversion costs are incurred evenly throughout the process. Suppose the ending work in process inventory is 38% of the way through the shaping process rather than 33% of the way through. Compute the total equivalent units of direct materials and conversion costs. Water Goggles Equivalent Units Conversion Direct Costs Materials 48,000 4,620 * 52,620 Conversion Costs
Water Goggles Shaping Department Month Ended January 31. Flow of Production Units to account for: Beginning work in process, January 1 Started in production during January Total physical units to account for Units accounted for: Shaping Department Equivalent Units Step 1 Flow of Production Flow of Completed and transferred out during January Ending work in process, January 31 14,000 Total physical units accounted for 62,000 Total equivalent units *14,000 units each 33% complete = 4,620 equivalent units Physical Units Ending work in process, January 31 0 Total equivalent units 62,000 62,000 48,000 Completed and transferred out during January Step 2 Equivalent Units Direct Materials 48,000 14,000 62,000 The direct materials are added at the beginning of the process, but conversion costs are incurred evenly throughout the process. Suppose the ending work in process inventory is 38% of the way through the shaping process rather than 33% of the way through. Compute the total equivalent units of direct materials and conversion costs. Water Goggles Equivalent Units Conversion Direct Costs Materials 48,000 4,620 * 52,620 Conversion Costs
Chapter1: Financial Statements And Business Decisions
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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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Transcribed Image Text:Water Goggles
Shaping Department
Month Ended January 31.
Flow of Production
Units to account for:
Beginning work in process,
January 1
Started in production during
January
Total physical units to account for
Units accounted for:
Shaping Department
Equivalent Units
Step 1
Flow of Production
Flow of
Completed and transferred out
during January
Ending work in process, January 31 14,000
Total physical units accounted for 62,000
Total equivalent units
*14,000 units each 33% complete
= 4,620 equivalent units
Physical
Units
Ending work in process, January 31
0
Total equivalent units
62,000
62,000
48,000
Completed and transferred out during January
Step 2
Equivalent
Units
Direct
Materials
48,000
14,000
62,000
The direct materials are added at the beginning of the process, but conversion costs are incurred evenly throughout the
process. Suppose the ending work in process inventory is 38%
of the way through the shaping process rather than 33% of the way through. Compute the total equivalent units of direct
materials and conversion costs.
Water Goggles
Equivalent Units
Conversion
Direct
Costs
Materials
48,000
4,620 *
52,620
Conversion
Costs
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