Determine the following using the First-In First-Out (FIFO) method of process costing 1. Equivalent units of production for materials and conversion cost 2. unit costs, and; 3. Inventory valu
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.
Problem No. 2(Cost Accounting)
Determine the following using the First-In First-Out (FIFO) method of
1. Equivalent units of production for materials and conversion cost
2. unit costs, and;
3. Inventory values
![Problem no. 2
Fresh Seasons is a contract manufacturer for Delectable Dressing Company. Fresh Seasons uses
a weighted average process costing system to account for its salad dressing production. All
ingredients are added at the start of the process. Delectable provides reusable vats to Fresh
Seasons for the completed product to be shipped to Delectable for bottling, so Fresh Seasons
incurs no packaging costs. April 2010 production and cost information for Fresh Seasons is as
follows:
Gallons of dressing in beginning WIP Inventory
Gallons completed during April
Gallons of dressing in ending WIP Inventory
Costs of beginning WIP Inventory
Direct material
Direct labor
Overhead
Costs incurred in April
Direct material
Direct labor
Overhead
for labor and overhead:
$1,136,025
451,450
723,195
April beginning and ending WIP inventories had the following percentages of completion
Direct labor
Overhead
April 1
55%
70%
36,000
242,000
23,500
April 30
15%
10%
$183,510
98,526
78,273](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fae5a81bc-0af3-4c6d-8908-5cdd19c1fcc7%2F293319b0-adf3-42af-b646-34142ad6850d%2F21p596j_processed.jpeg&w=3840&q=75)
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