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Process Cost Accounting—Additional Procedures;Accounting for Joint…
Process Cost Accounting—Additional Procedures;Accounting for Joint Products and By-Products
Equivalent Production—Materials Not
Uniformly Applied
Computing the unit cost in the Mixing Department where all the materials are added at the beginning of processing—average cost method.
Computing the unit cost in the Blending Department where all the materials are added at the close of processing—average cost method.
Computing the unit cost in the Packaging Department, where 60% of the materials cost is added to production at the beginning of processing and 40% of thematerials are added when the processing is one-half completed—average cost method
Mixing
Blending
Packaging
Units Lost in Production
Normal Losses
Product Cost
Abnormal Losses
Period Cost
Equivalent Production:
First-In, First-Out Method
to complete the beginning units of work in process
to start and fully complete an additional number of units
to start other units that will remain unfinished at the end of the period.
Average Costing
- the first step in preparing the cost of production summary is to list the costs that must be accounted for
- to determine the unit output for the month.
FIFO Costing
Units Gained in Production
The Increase Unit
The Lost Units
Joint Products and By-Products
Accounting for Join Product
Join Product
The costs of materials,
labor, and overhead incurred during such a joint production process
Split of Point
The point where these joint products become separately identifiable
Accounting for By-Product
Debiting an inventory account, By-Products, and crediting Work in Process for the estimated sales value of the by-products recovered.