Moravia Company processes and packages cream cheese. The following data have been compiled for the month of April. Conversion activity occurs uniformly throughout the production process. Work in process, April 1—10,000 units: Direct material: 100% complete, cost of .............................................................. $ 22,000 Conversion: 20% complete, cost of ..................................................................... 4,500 Balance in work in process, April 1........................................................................... $ 26,500 Units started during April .......................................................................................... 100,000 Units completed during April and transferred out to finished-goods inventory........ 80,000 Work in process, April 30: Direct material: 100% complete Conversion: 331 ⁄3% complete Costs incurred during April: Direct material....................................................................................................... $ 198,000 Conversion costs: Direct labor....................................................................................................... $ 52,800 Applied manufacturing overhead .................................................................... 105,600 Total conversion costs................................................................................................ $ 158,400 Required: Prepare schedules to accomplish each of the following process-costing steps for the month of April. Use the weighted-average method of process costing. 1. Analysis of physical flow of units. 2. Calculation of equivalent units. 3. Computation of unit costs. 4. Analysis of total costs
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.
Moravia Company processes and packages cream cheese. The following data have been compiled
for the month of April. Conversion activity occurs uniformly throughout the production process.
Work in process, April 1—10,000 units:
Direct material: 100% complete, cost of .............................................................. $ 22,000
Conversion: 20% complete, cost of ..................................................................... 4,500
Balance in work in process, April 1........................................................................... $ 26,500
Units started during April .......................................................................................... 100,000
Units completed during April and transferred out to finished-goods inventory........ 80,000
Work in process, April 30:
Direct material: 100% complete
Conversion: 331
⁄3% complete
Costs incurred during April:
Direct material....................................................................................................... $ 198,000
Conversion costs:
Direct labor....................................................................................................... $ 52,800
Applied manufacturing overhead .................................................................... 105,600
Total conversion costs................................................................................................ $ 158,400
Required:
Prepare schedules to accomplish each of the following process-costing steps for the month of
April. Use the weighted-average method of
1. Analysis of physical flow of units.
2. Calculation of equivalent units.
3. Computation of unit costs.
4. Analysis of total costs.
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