A department begins the month with 100 units at a cost of $7,500 and 25% complete in goods in process. An additional 1,000 units are started during the month and additional costs incurred are $12,500. At the end of the month, there are 200 units still in the process which are 50% complete. Using FIFO, the ending balance in the Work in Process Inventory is
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.
A department begins the month with 100 units at a cost of $7,500 and 25% complete in goods in process. An additional 1,000 units are started during the month and additional costs incurred are $12,500. At the end of the month, there are 200 units still in the process which are 50% complete. Using FIFO, the ending balance in the Work in Process Inventory is
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