Weighted Average Method, Journal Entries Muskoge Company uses a process-costing system. The company manufactures a product that is processed in two departments: Molding and Assembly. In the Molding Department, direct materials are added at the beginning of the process; in the Assembly Department, additional direct materials are added at the end of the process. In both departments, conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for February: Molding Assembly Beginning inventories: Physical units 10,000 8,000 Costs: Transferred in — $45,200 Direct materials $22,000 — Conversion costs $13,800 $20,450 Current production: Units started 25,000 ? Units transferred out 30,000 35,000 Costs: Transferred in — ? Direct materials $56,750 $40,250 Conversion costs $103,500 $140,150 Percentage of completion: Beginning inventory 40% 50% Ending inventory 80 50 Required: Question Content Area 1. Using the weighted average method, prepare the following for the Molding Department:
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.
Weighted Average Method,
Muskoge Company uses a process-costing system. The company manufactures a product that is processed in two departments: Molding and Assembly. In the Molding Department, direct materials are added at the beginning of the process; in the Assembly Department, additional direct materials are added at the end of the process. In both departments, conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for February:
| Molding | Assembly | |||
| Beginning inventories: | ||||
| Physical units | 10,000 | 8,000 | ||
| Costs: | ||||
| Transferred in | — | $45,200 | ||
| Direct materials | $22,000 | — | ||
| Conversion costs | $13,800 | $20,450 | ||
| Current production: | ||||
| Units started | 25,000 | ? | ||
| Units transferred out | 30,000 | 35,000 | ||
| Costs: | ||||
| Transferred in | — | ? | ||
| Direct materials | $56,750 | $40,250 | ||
| Conversion costs | $103,500 | $140,150 | ||
| Percentage of completion: | ||||
| Beginning inventory | 40% | 50% | ||
| Ending inventory | 80 | 50 |
Required:
Question Content Area
1. Using the weighted average method, prepare the following for the Molding Department:
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