man Sdn Bhd (ESB) is a manufacturer of superior rubbish bin, uses the weighted average method in its process costing system. ESB has produced the rubbish bin that passes through two processing departments: Moulding Department and Finishing Department. In the Moulding Department, all direct materials are added at the beginning of the process. Direct labor and manufacturing overhead are added uniformly. Percentage of completion in the Moulding Department for conversion costs is 30 percent for beginning work in process and 60 percent for ending work in process. Information related to the Mou
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.
QUESTION 1
Eman Sdn Bhd (ESB) is a manufacturer of superior rubbish bin, uses the weighted
average method in its
passes through two processing departments: Moulding Department and Finishing
Department. In the Moulding Department, all direct materials are added at the beginning
of the process. Direct labor and manufacturing overhead are added uniformly. Percentage
of completion in the Moulding Department for conversion costs is 30 percent for beginning
work in process and 60 percent for ending work in process. Information related to the
Moulding Department during March 2021 was summarized as follows:
REQUIRED:
(a) Prepare the physical units from units to account for, units accounted for and
equivalent units.
(b) Calculate cost per equivalent units.
(c) Calculate total cost for completed and transferred out and ending work in process.
(d) Explain how equivalent units for transferred-in is calculated under the First In, First
Out (FIFO) method.
(e) Explain how cost per equivalent unit is calculated under the FIFO method.
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