Principles of Cost Accounting, 16th Edition, Edward J

Slides:



Advertisements
Similar presentations
Principles of Cost Accounting, 16th Edition, Edward J. VanDerbeck, ©2013 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
Advertisements

Kinney ● Raiborn Cost Accounting: Foundations and Evolutions, 8e © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
Chapter 5: Job Order Costing
Kinney ● Raiborn Cost Accounting: Foundations and Evolutions, 8e © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
19 Costing Systems: Process Costing Principles of Accounting 12e
Cornerstones of Managerial Accounting, 5e
Process-Costing Systems
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
Principles of Cost Accounting, 16th Edition, Edward J
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
Principles of Cost Accounting 15 th edition Edward J. VanDerbeck © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
Principles of Cost Accounting, 16th Edition, Edward J
Chapter 6 Process Cost Accounting
Principles of Cost Accounting 15 th edition Edward J. VanDerbeck © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
Principles of Cost Accounting, 16th Edition, Edward J
Cost Accounting: Foundations and Evolutions, 8e Kinney ● Raiborn © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
Student Version © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted.
Principles of Cost Accounting 15 th edition Edward J. VanDerbeck © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
Principles of Cost Accounting 15 th edition Edward J. VanDerbeck © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
CORNERSTONES of Managerial Accounting, 5e © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part,
Standard Costing and Variance Analysis
Principles of Cost Accounting 15 th edition Edward J. VanDerbeck © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
CORNERSTONES of Managerial Accounting, 5e © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part,
Prepared by: C. Douglas Cloud Professor Emeritus of Accounting Pepperdine University © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned,
McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.
World Trade Equilibrium CHAPTER 20 © 2016 CENGAGE LEARNING. ALL RIGHTS RESERVED. MAY NOT BE COPIED, SCANNED, OR DUPLICATED, IN WHOLE OR IN PART, EXCEPT.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
Cost and Management Accounting: An Introduction, 7 th edition Colin Drury ISBN © 2011 Cengage Learning EMEA Process costing CHAPTER 6.
Process Costing Key Topics: Cost flows in mass production
Costing Systems: Process Costing 21. The Process Costing System OBJECTIVE 1: Describe the process costing system, and identify the reasons for its use.
Elasticity: Demand and Supply CHAPTER 6 © 2016 CENGAGE LEARNING. ALL RIGHTS RESERVED. MAY NOT BE COPIED, SCANNED, OR DUPLICATED, IN WHOLE OR IN PART, EXCEPT.
© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
Prepared by: C. Douglas Cloud Professor Emeritus of Accounting Pepperdine University © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned,
© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
Principles of Cost Accounting 15 th edition Edward J. VanDerbeck © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
Process Cost Accounting General Procedures
Student Version © 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted.
F2:Management Accounting. 2 Designed to give you knowledge and application of: Section D: Cost accounting techniques D1. Accounting for materials D2.
© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
Chapter 5: Job Order Costing
Chapter 11 Process costing
Chapter Three Process Costing.
Principles of Cost Accounting 15th edition
Principles of Cost Accounting 15th edition
Fundamentals of Cost Accounting, 4th edition Lanen/Anderson/Maher
Process Costing System
Cornerstones of Managerial Accounting, 6e
MANAGEMENT AND COST ACCOUNTING
Cornerstones of Managerial Accounting, 5e
Principles of Cost Accounting, 17th Edition, Edward J
CHAPTER 17 Process Costing Spoilage, Rework, and Scrap.
Chapter 6 Process Cost Accounting
Principles of Cost Accounting, 16th Edition, Edward J
CHAPTER 1 Introduction to International Macroeconomics
Principles of Cost Accounting 15th edition
Principles of Cost Accounting 15th edition
Presentation transcript:

Principles of Cost Accounting, 16th Edition, Edward J Principles of Cost Accounting, 16th Edition, Edward J. VanDerbeck, ©2013 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Chapter 6 Process Cost Accounting-Additional Procedures; Accounting for Joint Products and By-Products

Learning Objectives Compute unit costs when materials are not added uniformly throughout the process. Account for units lost in the production process. Account for units gained in the production process.

Learning Objectives (cont.) Assign costs to inventories, using the first-in, first-out method. Identify the methods used to apportion joint costs products and account for by-products.

Materials not Uniformly Applied Materials may be put into production in varying quantities and at different points in the processing cycle. When industries apply materials into production in different quantities and at varying points in the production cycle, equivalent units must be computed for each element of production cost.

Materials not Uniformly Applied The valuation of the ending work in process requires the allocation of cost for each element: Materials Labor Factory Overhead

All materials added at the beginning The only difference between equivalent unit calculations for the material components and the labor and overhead components would concern the ending work in process inventory. Example: Ending inventory of 400 units that were ¾ complete. Materials – 400 equivalent units (received all materials when started) Labor and overhead – 300 equivalent units (400 x ¾ completed as to processing costs)

All materials added at the beginning Once the equivalent production figures are calculated, the unit cost for the period can be calculated. Add the cost of each element in beginning WIP to the cost of production for that element incurred in the current month. Total cost is then divided by the appropriate equivalent production figure. Cost is then applied to inventory to arrive at cost of goods finished and the cost of the ending WIP.

All materials added at the close of processing Only units finished will have materials cost applied. Units in process at the end of the accounting period will have no equivalent production for the period. Equivalent units for labor and factory overhead would be computed as the previous example.

Materials added at different stages The state of completion must be carefully considered. Finished units will include all materials costs. Example: 60 % of the materials at beginning 40 % of the materials at one-half completed 2,400 units were finished Ma

Materials added at different stages Example cont. 200 units are one-fourth completed as to labor and overhead; because they are not yet 50 % complete, only 60% of materials are added. (200 X 60%) = 120 units 400 are three-fourth completed as to labor and overhead; because they are more than 50% complete all the materials have been added. Ma

Materials added at different stages Example cont. Therefore, equivalent production for materials is figured as follows 2,400 X 100 % = 2,400 200 X 60 % = 120 400 X 100 % = 400 2,920 units Ma

Units Lost in Production Some production processes are of the nature that some units will always be lost due to evaporation, shrinkage, spillage, or other factors. Normal losses are expected in the manufacturing process and cannot be avoided and are treated as product losses.

Units Lost in Production Abnormal losses are treated as a period costs and are charged to a separate account, such as Loss from Abnormal Spoilage. These losses do not become a part of inventory costs.

Units Gained in Production The increase in units has the opposite effect on unit cost than did lost units, and requires an adjustment to the unit cost. Total cost for the original units are now spread over a greater number of units, thereby reducing the cost per unit.

Equivalent Production: FIFO

Equivalent Production: FIFO

Equivalent Production: FIFO

Joint Products and By-Products

Joint Products and By-Products The cost of materials, labor, and overhead incurred during such a joint production process are called joint costs. The point where these joint products become separately identifiable is known as the split-off point.

Joint Products and By-Products Typical bases for apportionment of joint costs to joint products follow: Relative(or adjusted) sales value of each product. A physical unit measure such as volume, weight, size, or grade. Chemical, engineering, or other types of analyses.

Joint Products and By-Products

Joint Products and By-Products