Lighthouse Paper Company manufactures newsprint. The product is manufactured in two departments, Papermaking and Converting. Pulp is first placed into a vessel at the beginning of papermaking production. The following information concerns production in the Papermaking Department for March. Account Work in Process—Papermaking Department Account No. Date Item Debit Credit Balance Debit Credit Mar. 1 Bal., 5,900 units, 10% completed 14,868 31 Direct materials, 31,500 units 44,100 58,968 31 Direct labor 13,460 72,428 31 Factory overhead 7,570 79,998 31 Goods transferred, 35,200 units ? ? 31 Bal., 2,200 units, 20% completed ?
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.
Lighthouse Paper Company manufactures newsprint. The product is manufactured in two departments, Papermaking and Converting. Pulp is first placed into a vessel at the beginning of papermaking production. The following information concerns production in the Papermaking Department for March.
| Account Work in Process—Papermaking Department | Account No. | ||||||||
| Date | Item | Debit | Credit | Balance | |||||
| Debit | Credit | ||||||||
| Mar. | 1 | Bal., 5,900 units, 10% completed | 14,868 | ||||||
| 31 | Direct materials, 31,500 units | 44,100 | 58,968 | ||||||
| 31 | Direct labor | 13,460 | 72,428 | ||||||
| 31 | Factory overhead | 7,570 | 79,998 | ||||||
| 31 | Goods transferred, 35,200 units | ? | ? | ||||||
| 31 | Bal., 2,200 units, 20% completed | ? |
|
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