Question 3: Process Costing (FIFO) Daytona Incorporated uses the first-in, first-out method in its process costing system. The following data is on the operations of the company’s first processing department for a recent month. Work in process, beginning: Units in process 700 Percent complete with respect to materials 60% Percent complete with respect to conversion 10% Costs in the beginning inventory: Materials cost $ 555 Conversion cost $ 2,123 Units started into production during the month 21,000 Units completed and transferred out 21,000 Costs added to production during the month: Materials cost $ 48,461 Conversion cost $ 559,062 Work in process, ending: Units in process 700 Percent complete with respect to materials 70% Percent complete with respect to conversion 70% Required: Using the first-in, first-out method: a. Determine the equivalent units of production for materials and conversion costs. b. Determine the cost per equivalent unit for materials and con
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.
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