Required: Prepare schedules to accomplish each of the following process-costing steps for the month of June. Use the weighted-average method of process costing. 1. Analysis of physical flow of units. 2. Calculation of equivalent units. 3. Computation of unit costs.
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.
Piscataway Plastics Company manufactures a highly specialized plastic that is used extensively in
the automobile industry. The following data have been compiled for the month of June.
Conversion activity occurs uniformly throughout the production process.
Work in process, June 1—50,000 units:
Direct material: 100% complete, cost of...............................................................$120,000
Conversion: 40% complete, cost of ..................................................................... 34,400
Balance in work in process, June 1 ..................................................................$154,400
Units started during June ........................................................................................... 200,000
Units completed during June and transferred out to finished-goods inventory......... 190,000
Work in process, June 30:
Direct material: 100% complete
Conversion: 60% complete
Costs incurred during June:
Direct material.......................................................................................................$492,500
Conversion costs:
Direct labor............................................................................................................$ 87,450
Applied manufacturing
Total conversion costs...........................................................................................$349,800
Required: Prepare schedules to accomplish each of the following process-costing steps for the
month of June. Use the weighted-average method of
1. Analysis of physical flow of units.
2. Calculation of equivalent units.
3. Computation of unit costs.
4. Analysis of total costs.
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