Determine the number of units in work in process inventory at March 31. units b. Determine the equivalent units of production for direct materials and conversion costs in March.
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.
Equivalent Units of Production
The following information concerns production in the Baking Department for March. All direct materials are placed in process at the beginning of production.
| ACCOUNT Work in Process—Baking Department | ACCOUNT NO. | |||||||
| Date | Item | Debit | Credit | Balance | ||||
| Debit | Credit | |||||||
| Mar. | 1 | Bal., 18,000 units, 1⁄4 completed | 14,760 | |||||
| 31 | Direct materials, 336,000 units | 252,000 | 266,760 | |||||
| 31 | Direct labor | 40,000 | 306,760 | |||||
| 31 | Factory overhead | 60,530 | 367,290 | |||||
| 31 | Goods finished, 330,000 units | 346,410 | 20,880 | |||||
| 31 | Bal. ? units, 2⁄5 completed | 20,880 |
a. Determine the number of units in work in process inventory at March 31.
units
b. Determine the equivalent units of production for direct materials and conversion costs in March. If an amount is zero, enter in "0".
| Baking Department | |||
| Equivalent Units of Production for Direct Materials and Conversion Costs | |||
| For March | |||
| Whole Units | Direct Materials Equivalent Units |
Conversion Equivalent Units |
|
| Inventory in process, March 1 | |||
| Started and completed in March | |||
| Transferred to finished goods in March | |||
| Inventory in process, March 31 | |||
| Total |
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