Kimbeth Manufacturing uses a process cost system to manufacture dustdensity sensors for the mining industry. The following informationpertains to operations for the month of May: Units Beginning work in process inventory, May 1Started in production during MayCompleted production during MayEnding work in process inventory, May 31 16,000100,00092,00024,000 The beginning inventory was 60% complete for materials and 20%complete for conversion costs. The ending inventory was 90% completefor materials and 40% complete for conversion costs.Costs pertaining to the month of May are: . Beginning inventory costs: materials, $54,560; direct labor, $20,320;and factory overhead, $15,240.. Costs incurred during May: materials used, $468,000; direct labor,$182,880; and factory overhead, $391,160. Using the first-in, first-out (FIFO) method, the equivalent units ofproduction for conversion costs are:a. 101,600 units. b. 85,600 units.C. 98,400 units.d. 88,800 units.
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.
Kimbeth Manufacturing uses a
density sensors for the mining industry. The following information
pertains to operations for the month of May:
| Units | |
| Beginning work in process inventory, May 1 Started in production during May Completed production during May Ending work in process inventory, May 31 |
16,000 100,000 92,000 24,000 |
The beginning inventory was 60% complete for materials and 20%
complete for conversion costs. The ending inventory was 90% complete
for materials and 40% complete for conversion costs.
Costs pertaining to the month of May are:
. Beginning inventory costs: materials, $54,560; direct labor, $20,320;
and factory
. Costs incurred during May: materials used, $468,000; direct labor,
$182,880; and factory overhead, $391,160.
Using the first-in, first-out (FIFO) method, the equivalent units of
production for conversion costs are:
a. 101,600 units.
b. 85,600 units.
C. 98,400 units.
d. 88,800 units.
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