Aztec Inc. produces soft drinks. Mixing is the first department, and its output is measured in gallons. Aztec uses the FIFO method. All manufacturing costs are added uniformly. For July, the mixing department provided the following information: Production: Units in process, July 1, 80% complete 120,000 gallons Units completed and transferred out 690,000 gallons Units in process, July 31, 75% complete 80,000 gallons Costs: Work in process, July 1 $120,000 Costs added during July 1,471,500 Required: 1. Calculate the equivalent units for July. fill in the blank 1 equivalent units 2. Calculate the unit cost. $fill in the blank 2per unit 3. Assign costs to units transferred out and EWIP using the FIFO method. Cost of goods transferred out $fill in the blank 3 Ending work in process $fill in the blank 4
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.
Aztec Inc. produces soft drinks. Mixing is the first department, and its output is measured in gallons. Aztec uses the FIFO method. All
| Production: | ||
| Units in process, July 1, 80% complete | 120,000 gallons | |
| Units completed and transferred out | 690,000 gallons | |
| Units in process, July 31, 75% complete | 80,000 gallons | |
| Costs: | ||
| Work in process, July 1 | $120,000 | |
| Costs added during July | 1,471,500 |
Required:
1. Calculate the equivalent units for July.
fill in the blank 1 equivalent units
2. Calculate the unit cost.
$fill in the blank 2per unit
3. Assign costs to units transferred out and EWIP using the FIFO method.
| Cost of goods transferred out | $fill in the blank 3 |
| Ending work in process | $fill in the blank 4 |
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