Cost of materials purchased
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.
These data relates to Judy Company’s July 2020 operations:
Materials, beginning P 7,000 Materials, Ending P9,000
WIP, Beginning 7,500 WIP, Ending 3,500
Finished Goods, beg. 10,000 Finished Goods, End. 12,000
Materials used 46,800 Direct Expenses 400
Selling and general expenses 6,700 Direct Labor 8,000
Factory overhead is applied at the rate of 80% of direct labor cost.
Required:
Compute for the following (Show your solution) :
1. Cost of materials purchased
2. Cost of goods manufactured
3. Cost of goods sold and
4. Conversion Cost
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