Production Data June Beginning work in process units 0 Units started into production 25,960 Ending work in process units 2,360 Percent complete—ending inventory 40 % Cost Data Materials $233,640 Labor 63,248 Overhead 133,104 Total $429,992
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.
Rosenthal Company manufactures bowling balls through two processes: Molding and Packaging. In the Molding Department, the urethane, rubber, plastics, and other materials are molded into bowling balls. In the Packaging Department, the balls are placed in cartons and sent to the finished goods warehouse. All materials are entered at the beginning of each process. Labor and manufacturing overhead are incurred uniformly throughout each process. Production and cost data for the Molding Department during June 2020 are presented below.
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Production Data
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June
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|---|---|---|---|
| Beginning work in process units | 0 | ||
| Units started into production | 25,960 | ||
| Ending work in process units | 2,360 | ||
| Percent complete—ending inventory | 40 | % |
Materials $233,640
Labor 63,248
Overhead 133,104
Total $429,992
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Materials
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Conversion Costs
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| Total equivalent units |
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eTextbook and Media
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Materials
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Conversion Costs
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Total Unit Cost
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|---|---|---|---|---|---|---|
| Unit Costs |
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$enter a dollar amount
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$enter a total amount
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eTextbook and Media
| Transferred out |
$enter a dollar amount
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| Work in process, June 30 |
$enter a dollar amount
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Solution 1:
| Equivalent units of production (EUP) | |||||
| Units | % material | EUP-Materials | % Conversion | EUP- Conversion | |
| Units Completed and transferred out (25960-2360) | 23600 | 100% | 23600 | 100% | 23600 |
| units of Ending work in process | 2360 | 100% | 2360 | 40% | 944 |
| Equivalent units of production | 25960 | 24544 | |||
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