Lind Manufacturing had the following account balances as of January 1. Direct Materials Inventory $ 8,700 Work in Process Inventory 76,500 Finished Goods Inventory 53,000 Manufacturing Overhead 0 During the month of January, all of the following occurred. Direct labor costs were $47,000 for 1,800 hours worked. Direct materials costing $29,000 and indirect materials costing $5,000 were purchased. Sales commissions of $16,000 were earned by the sales force. Direct materials of $23,000 were used in production. Miscellaneous selling and administrative costs of $6,300 were incurred. Factory supervisors earned salaries of $11,035. Other Indirect labor costs for the month were $3,000. Monthly depreciation on factory equipment was $4,500. Monthly utilities expenses of $7,427 were incurred in the factory. Completed units with manufacturing costs of $69,000 were transferred to finished goods. Monthly insurance costs for the factory were $4,200. Monthly property taxes on the factory of $5,000 were incurred and paid. Units with manufacturing costs of $89,277 were sold for $162,322. Required: a. If Lind assigns manufacturing overhead of $34,400, what will be the balances in the Direct Materials, Work in Process, and Finished Goods Inventory accounts at the end of January? b. As of January 31, what will be the balance in the Manufacturing Overhead account? c. What was Lind’s operating income for January?
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.
Lind Manufacturing had the following account balances as of January 1. Direct Materials Inventory $ 8,700 Work in Process Inventory 76,500 Finished Goods Inventory 53,000 Manufacturing Overhead 0 During the month of January, all of the following occurred. Direct labor costs were $47,000 for 1,800 hours worked. Direct materials costing $29,000 and indirect materials costing $5,000 were purchased. Sales commissions of $16,000 were earned by the sales force. Direct materials of $23,000 were used in production. Miscellaneous selling and administrative costs of $6,300 were incurred. Factory supervisors earned salaries of $11,035. Other Indirect labor costs for the month were $3,000. Monthly
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