Selected financial information for Shadyside Manufacturing is presented in the following table (000s omitted). Sales revenue $5,000 Purchases of direct materials $480 Direct labor $510 Manufacturing overhead $690 Operating expenses $680 Beginning raw materials inventory $260 Ending raw materials inventory $180 Beginning work in process inventory $360 Ending work in process inventory $450 Beginning finished goods inventory $300 Ending finished goods inventory $230 What was the cost of direct materials used? $740 $440 $560 $480
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.
- Selected financial information for Shadyside Manufacturing is presented in the following table (000s omitted).
|
Sales revenue |
$5,000 |
|
Purchases of direct materials |
$480 |
|
Direct labor |
$510 |
|
Manufacturing |
$690 |
|
Operating expenses |
$680 |
|
Beginning raw materials inventory |
$260 |
|
Ending raw materials inventory |
$180 |
|
Beginning work in process inventory |
$360 |
|
Ending work in process inventory |
$450 |
|
Beginning finished goods inventory |
$300 |
|
Ending finished goods inventory |
$230 |
What was the cost of direct materials used?
- $740
- $440
- $560
- $480
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