Anthony Burkhardt's Ch21-PowerPoint

Oh 2 determine total manufacturing costs 3 calculate

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Unformatted text preview: he period Chapter 21-5 PROCESS COST ACCOUNTING For each process or department, we need to: For 1 Summarize manufacturing costs (DM, DL, & Man. O/H) 2 Determine total manufacturing costs 3 Calculate unit product costs How do we do these in a process cost accounting system? Through a Production Cost report, of which the three major parts are: Through Production Raw Material, Factory Labor and Cost of Manufacturing Overhead: Raw 1 Calculate the physical units. Calculate 2 Calculate equivalent units of production. Calculate units WIP: 3 Calculate unit costs of production. Calculate Work In Process: 4 Assign costs to the units transferred and in process. Assign units (These four steps appear on the production cost report.) Chapter 21-6 EQUIVALENT UNITS Weighted Average Method In its simpliest terms, the concept of equivalent units is In just taking partially-completed units and combining them into 100% completed units. For example: Boeing manufactures airplanes and say at the end of May, they have two partially-completed airplanes: airplanes: 1 airplane that is 90% complete airplane 1 airplane that is 10% complete 10% 2 100% 100% Instead of having 2 partially-completed airplanes, Instead Boeing has one, 100% completed airplane. Again, this is very simple example. this Chapter 21-7 EQUIVALENT UNITS Weighted Average Method Equivalent units of production Equivalent – the work done during the period on the physical units of the output, ex...
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This document was uploaded on 03/23/2014.

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