Pastilla Company manufactures a product that passes through two processes: blending and encapsulating. All manufacturing costs are added uniformly in the blending department. Information for the blending department for April is as follows: Work in process, April 1 Units (60% complete) 10,000 Direct materials $80,000 Direct labor $96,000 Overhead $16,000 During April, 160,000 units were completed and transferred to encapsulating. The following costs were incurred by the blending department during April: Direct materials $720,000 Direct labor $800,000 Overhead $236,800 On April 30, 24,000 units that were 10% complete remained in the blending department. Required: Complete the following: (Note: Use the weighted average method.) A. The equivalent units of production for April total . B. April's total costs to account for are $. C. The total cost per equivalent unit of production is $. D. The cost of goods transferred to the encapsulating department is $. E. The cost of April's ending work in process for the blending department is $.
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.
Pastilla Company manufactures a product that passes through two processes: blending and encapsulating. All
Information for the blending department for April is as follows:
| Work in process, April 1 | |
| Units (60% complete) | 10,000 |
| Direct materials | $80,000 |
| Direct labor | $96,000 |
| $16,000 |
During April, 160,000 units were completed and transferred to encapsulating.
The following costs were incurred by the blending department during April:
| Direct materials | $720,000 |
| Direct labor | $800,000 |
| Overhead | $236,800 |
On April 30, 24,000 units that were 10% complete remained in the blending department.
Required:
Complete the following: (Note: Use the weighted average method.)
A. The equivalent units of production for April total .
B. April's total costs to account for are $.
C. The total cost per equivalent unit of production is $.
D. The cost of goods transferred to the encapsulating department is $.
E. The cost of April's ending work in process for the blending department is $.
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