Zeus Corporation produces cultured diamonds via a secretive process that grows the diamonds in a vacuum chamber filled with a carbon gas cloud. The diamonds are produced in a single continuous process and Zeus uses the weighted-average process costing method of accounting for production. The production process requires constant utilization of facilities and equipment, as well as direct labor by skilled technicians. As a result, direct labor and factory overhead are both deemed to be introduced uniformly throughout production. At the beginning of June, 6,000 diamonds were in process. During June, an additional 9,000 diamonds were started. 7,000 diamonds were completed and transferred to finished goods. As of the beginning of the month, work in process was 80% complete with respect to materials and 60% complete with respect to conversion costs. As of the end of the month, work in process was 50% complete with respect to materials and 30% complete with respect to conversion costs. Calculate the equivalent units of direct labor for June. A. 86,800 B. 1,800 C. 6,000 D. 9,400 E. none of the above
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.
Zeus Corporation produces cultured diamonds via a secretive process that grows the diamonds in a vacuum chamber filled with a carbon gas cloud. The diamonds are produced in a single continuous process and Zeus uses the weighted-average
The production process requires constant utilization of facilities and equipment, as well as direct labor by skilled technicians. As a result, direct labor and factory overhead are both deemed to be introduced uniformly throughout production.
At the beginning of June, 6,000 diamonds were in process. During June, an additional
9,000 diamonds were started. 7,000 diamonds were completed and transferred to finished goods.
As of the beginning of the month, work in process was 80% complete with respect to materials and 60% complete with respect to conversion costs.
As of the end of the month, work in process was 50% complete with respect to materials and 30% complete with respect to conversion costs.
Calculate the equivalent units of direct labor for June.
| A. |
86,800 |
|
| B. |
1,800 |
|
| C. |
6,000 |
|
| D. |
9,400 |
|
| E. |
none of the above |
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
