The following information is given for the year ended 31 October 2000: £ Purchase of raw materials 28,000 Returns inwards 2,000 Increase in stock of raw materials 850 Direct wages 10,500 Carriage inwards 1,250 Production overheads 7,000 Decrease in work-in-progress 2,500 The value of factory cost of goods completed 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.
The following information is given for the year ended 31 October 2000:
£
Purchase of raw materials 28,000
Returns inwards 2,000
Increase in stock of raw materials 850
Direct wages 10,500
Carriage inwards 1,250
Production
Decrease in work-in-progress 2,500
The value of
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