Allure Company produces women’s clothing. During 2004, the company incurred the following costs: Factory rent 265,000 Direct labor 325,000 Utilities-Factory 88,000 Purchases of direct materials 465,000 Indirect materials 70,000 Indirect labors 35,000 Inventories for the year were as follows: January 1 December 31 Direct materials 90,000 50,000 Work in process 40,000 85,000 Finished goods 115,000 95,000 Required Prepare a statement of cost of goods manufactured Calculate cost of goods sold
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.
Allure Company produces women’s clothing.
During 2004, the company incurred the following costs:
Factory rent
265,000
Direct labor
325,000
Utilities-Factory
88,000
Purchases of direct materials
465,000
Indirect materials
70,000
Indirect labors
35,000
Inventories for the year were as follows:
January 1
December 31
Direct materials
90,000
50,000
Work in process
40,000
85,000
Finished goods
115,000
95,000
Required
Prepare a statement of cost of goods manufactured
Calculate cost of goods sold.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
