Always Christmas makes artificial Christmas trees in two departments: Cutting and Boxing. In the Cutting Department, wire wrapped with green ‘‘needles’’ is placed into production at the beginning of the process and is cut to various lengths. The ‘‘branches’’ are then transferred to the Boxing Department, where the lengths are separated into the necessary groups to make a tree. The ‘‘limbs’’ are then placed in boxes and immediately sent to Finished Goods. The following data are available related to the October production in each of the two departments: Percent of Completion Units Transferred In Material Conversion Cutting Development Beginning WIP Inventory 4,800 N/A 100 40 Started in process 21,600 Ending inventory 2,160 N/A 100 70 Boxing Department Beginning WIP Inventory 1,500 100 0 65 Transferred in ? Ending inventory 720 100 0 70 Costs Transferred In Material Conversion Cutting Department Beginning WIP Inventory N/A $175,800 $48,000 Current period N/A $827,400 $776,064 Boxing Department Beginning WIP Inventory $99,852 $- $4,196 Current period ? $230,184 $147,672 b. Using the data developed from (a), prepare a cost of production report for the Boxing Department assuming a weighted average method. Note: Round the costs per EUP to the nearest two decimal points; use the rounded amounts in subsequent calculations. Note: Other than costs per EUP, round all amounts to the nearest whole dollar.
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.
Always Christmas makes artificial Christmas trees in two departments: Cutting and Boxing. In the Cutting Department, wire wrapped with green ‘‘needles’’ is placed into production at the beginning of the process and is cut to various lengths. The ‘‘branches’’ are then transferred to the Boxing Department, where the lengths are separated into the necessary groups to make a tree. The ‘‘limbs’’ are then placed in boxes and immediately sent to Finished Goods.
The following data are available related to the October production in each of the two departments:
Percent of Completion
| Units | Transferred In | Material | Conversion | |
| Cutting Development | ||||
| Beginning WIP Inventory | 4,800 | N/A | 100 | 40 |
| Started in process | 21,600 | |||
| Ending inventory | 2,160 | N/A | 100 | 70 |
| Boxing Department | ||||
| Beginning WIP Inventory | 1,500 | 100 | 0 | 65 |
| Transferred in | ? | |||
| Ending inventory | 720 | 100 | 0 | 70 |
Costs
| Transferred In | Material | Conversion | |
| Cutting Department | |||
| Beginning WIP Inventory | N/A | $175,800 | $48,000 |
| Current period | N/A | $827,400 | $776,064 |
| Boxing Department | |||
| Beginning WIP Inventory | $99,852 | $- | $4,196 |
| Current period | ? | $230,184 | $147,672 |
b. Using the data developed from (a), prepare a cost of production report for the Boxing Department assuming a weighted average method.
Note: Round the costs per EUP to the nearest two decimal points; use the rounded amounts in subsequent calculations.
Note: Other than costs per EUP, round all amounts to the nearest whole dollar.
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