Handy Crafts manufactures to customers specifications. The company uses a job order cost system and, for the month of May, 2001 summarized the following information: Beginning work in process inventory (five partially completed jobs) P300,000 Orders completed (eighteen) 2,400,000 Orders shipped out (fourteen) 2,000,000 Materials requisitioned 1,700,000 Direct labor cost 800,000 Overhead = 150% of direct labor cost. The month-end work in process inventory was?
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.
Handy Crafts manufactures to customers specifications. The company uses a
|
(five partially completed jobs) |
P300,000 |
|
|
Orders completed (eighteen) |
2,400,000 |
|
|
Orders shipped out (fourteen) |
2,000,000 |
|
|
Materials requisitioned |
1,700,000 |
|
|
Direct labor cost
|
800,000 |
|
The month-end work in process inventory was?
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