CALCULATION OF WORK IN PROCESS AND COST OF GOODS SOLD WITH MULTIPLE JOBS Greenthumb Landscape Design designs landscape plans and plants the material for clients. On April 1, there were three jobs in process, Jobs 68, 69, and 70. During April, two more jobs were started, Jobs 71 and 72. By April 30, Jobs 69, 70, and 72 were completed and sold. The following data were gathered: Overhead is applied at the rate of 120 percent of direct labor cost. Jobs are sold at cost plus 40 percent. Selling and administrative expenses for April totaled $3,670.
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.
CALCULATION OF WORK IN PROCESS AND COST OF GOODS SOLD WITH MULTIPLE JOBS
Greenthumb Landscape Design designs landscape plans and plants the material for clients. On April 1, there were three jobs in process, Jobs 68, 69, and 70. During April, two more jobs were started, Jobs 71 and 72. By April 30, Jobs 69, 70, and 72 were completed and sold. The following data were gathered:
Overhead is applied at the rate of 120 percent of direct labor cost. Jobs are sold at cost plus 40 percent. Selling and administrative expenses for April totaled $3,670.
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