At Barbie Company, direct materials are added at the start of the process and conversion costs are added evenly during the process. Company is using FIFO method. Beginning WIP (conversion 75% completed) 12,000 units Units started 74,000 units Units completed and transferred out during current month 65,000 units Ending WIP (conversion 80% completed) 18,000 units Inspection occurs when production is 100% completed. Normal spoilage is 4% of good units that successfully pass the inspection point in current month. BWIP cost, DM $216,000, CC $27,000 Cost added during the period. DM $1,346,800, CC $234,880 What is the cost of units completed and transferred out? If using weighted average method, what would be the cost of units completed and transferred? Having trouble calculating cost of units completed and transferred, please write a formula.
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.
At Barbie Company, direct materials are added at the start of the process and conversion costs are added evenly during the process. Company is using FIFO method.
Beginning WIP (conversion 75% completed) 12,000 units
Units started 74,000 units
Units completed and transferred out during current month 65,000 units
Ending WIP (conversion 80% completed) 18,000 units
Inspection occurs when production is 100% completed. Normal spoilage is 4% of good units that successfully pass the inspection point in current month.
BWIP cost, DM $216,000, CC $27,000
Cost added during the period. DM $1,346,800, CC $234,880
What is the cost of units completed and transferred out?
If using weighted average method, what would be the cost of units completed and transferred?
Having trouble calculating cost of units completed and transferred, please write a formula.
Trending now
This is a popular solution!
Step by step
Solved in 5 steps with 3 images
