has a job costing system. The following items appeared in the Work-in-Process account during April 2018: April 1, 2018, balance $ 20,000 Materials placed into production ? Direct labor (4,000 hours) $120,000 Factory overhead applied $ 96,000 Cost of goods manufactured $400,000 April 30, 2018, balance $ 16,000 ABC applies overhead to production on the basis of direct labor hours. Job XX, the only job in process on April 30, has been charged $10,600 materials cos
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.
ABC Company has a
April 1, 2018, balance $ 20,000
Materials placed into production ?
Direct labor (4,000 hours) $120,000
Factory overhead applied $ 96,000
Cost of goods manufactured $400,000
April 30, 2018, balance $ 16,000
ABC applies overhead to production on the basis of direct labor hours. Job XX, the only job in process on April 30, has been charged $10,600 materials cost and has 100 labor hours of direct labor time assigned to it.
Required:
- Determine the predetermined factory overhead rate for ABC Company.
- Determine the amounts of materials, direct labor, and factory overhead included in the April 30, 2018, work in process.
- Determine the amount of materials placed into production during April 2018.
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