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1、chap09_管理本钱会计_CGA_MA1_Managerial_Accounting_management_accounting_课件Systems Design: Process CostingChapter 9Similarities Between Job-Order and Process CostingBoth systems assign material, labor and overhead costs to products and they provide 7a mechanism for computing unit product costs3.Both system
2、s use the same manufacturing accounts, including Manufacturing Overhead, Raw Materials, Work in Process, and Finished Goods.The flow of costs through the manufacturing accounts is basically the same in both systems.Differences Between Job-Order and Process CostingProcess costing is used when a singl
3、e product is produced on a continuing basis or for a long period of time. Job-order costing is used when many different jobs having different production requirements are worked on each period.Process costing systems accumulate costs by department. Job-order costing systems accumulated costs by indiv
4、idual jobs.Process costing systems compute unit costs by department. Job-order costing systems compute unit costs by job on the job cost sheet.Process costing is used for products that are: a. Different and produced continuously. b. Similar and produced continuously. c. Individual units produced to
5、customer specifications. d. Purchased from vendors.Quick Check ?Process costing is used for products that are: a. Different and produced continuously. b. Similar and produced continuously. c. Individual units produced to customer specifications. d. Purchased from vendors.Quick Check ?Processing Depa
6、rtmentsAny unit in an organization where materials, labor or overhead are added to the product.The activities performed in a processing department are performed uniformly on all units of production. Furthermore, the output of a processing department must be homogeneous. Products in a process costing
7、 environment typically flow in a sequence from one department to another.Learning Objective 1Record the flow of materials, labor, and overhead through a process costing system.Comparing Job-Order and Process CostingFinished GoodsCost of Goods SoldWork in ProcessDirect MaterialsDirect LaborManufactur
8、ing Overhead Comparing Job-Order and Process CostingFinished GoodsCost of Goods SoldDirect LaborManufacturing Overhead JobsCosts are traced and applied to individual jobs in a job-order cost system.Direct MaterialsComparing Job-Order and Process CostingFinished GoodsCost of Goods SoldDirect LaborMan
9、ufacturing Overhead ProcessingDepartmentCosts are traced and applied to departments in a process cost system.Direct MaterialsT-Account and Journal Entry Views of Process Cost FlowsFor purposes of this example, assume there are two processing departments Departments A and B. We will use T-accounts an
10、d journal entries. Raw MaterialsProcess Cost Flows: The Flow of Raw Materials (in T-account form) Work in Process Department B Work in Process Department ADirect MaterialsDirect MaterialsDirect MaterialsProcess Cost Flows: The Flow of Raw Materials (in journal entry form)Process Cost Flows: The Flow
11、 of Labor Costs (in T-account form) Work in Process Department B Work in Process Department A Salaries and Wages PayableDirect MaterialsDirect MaterialsDirect LaborDirect LaborDirect LaborProcess Costing: The Flow of Labor Costs (in journal entry form)Process Cost Flows: The Flow of Manufacturing Ov
12、erhead Costs (in T-account form) Work in Process Department B Work in Process Department AManufacturing OverheadOverhead Applied to Work in ProcessApplied OverheadApplied OverheadDirect LaborDirect MaterialsDirect LaborDirect MaterialsActual OverheadProcess Cost Flows: The Flow of Manufacturing Over
13、head Costs (in journal entry form)Process Cost Flows: Transfers from WIP-Dept. A to WIP-Dept. B (in T-account form)Work in Process Department BWork in Process Department ADirect MaterialsDirect LaborApplied OverheadDirect MaterialsDirect LaborApplied OverheadTransferred to Dept. BTransferred from De
14、pt. ADepartment ADepartment BProcess Cost Flows: Transfers from WIP-Dept. A to WIP-Dept. B (in journal entry form)Finished GoodsProcess Cost Flows: Transfers from WIP-Dept. B to Finished Goods (in T-account form) Work in Process Department BCost of Goods ManufacturedDirect MaterialsDirect LaborAppli
15、ed OverheadTransferred from Dept. ACost of Goods Manufactured Process Cost Flows: Transfers from WIP-Dept. B to Finished Goods (in journal entry form)Finished Goods Cost of Goods SoldProcess Cost Flows: Transfers from Finished Goods to COGS (in T-account form) Work in Process Department BCost of Goo
16、ds ManufacturedDirect MaterialsDirect LaborApplied OverheadTransferred from Dept. ACost of Goods Sold Cost of Goods Sold Cost of Goods Manufactured Process Cost Flows: Transfers from Finished Goods to COGS (in journal entry form)Equivalent Units of ProductionEquivalent units are the product of the n
17、umber of partially completed units and the percentage completion of those units. We need to calculate equivalent units because a department usually has some partially completed units in its beginning and ending inventory. These partially completed units complicate the determination of a departments
18、output for a given period and the unit cost that should be assigned to that output.Equivalent Units The Basic IdeaTwo half completed products are equivalent to one complete product.So, 10,000 units 70% complete are equivalent to 7,000 complete units.+=1 For the current period, Jones started 15,000 u
19、nits and completed 10,000 units, leaving 5,000 units in process 30 percent complete. How many equivalent units of production did Jones have for the period? a. 10,000 b. 11,500 c. 13,500 d. 15,000Quick Check ? For the current period, Jones started 15,000 units and completed 10,000 units, leaving 5,00
20、0 units in process 30 percent complete. How many equivalent units of production did Jones have for the period? a. 10,000 b. 11,500 c. 13,500 d. 15,000 10,000 units + (5,000 units 0.30) = 11,500 equivalent unitsQuick Check ?Calculating Equivalent UnitsEquivalent units can be calculated two ways:?The
21、First-In, First-Out Method FIFO is covered in the appendix to this chapter.?The Weighted-Average Method This method will be covered in the main portion of the chapter.Learning Objective 2Compute the equivalent units of production using the weighted-average method.Equivalent Units of ProductionWeight
22、ed-Average MethodThe weighted-average method . . .Makes no distinction between work done in prior or current periods.Blends together units and costs from prior and current periods.Determines equivalent units of production for a department by adding together the number of units transferred out plus t
23、he equivalent units in ending Work in Process Inventory.Treatment of Direct LaborDirect labor costs may be small in comparison to other productcosts in process cost systems.Direct MaterialsType of Product CostDollar AmountDirect LaborManufacturing OverheadTreatment of Direct LaborType of Product Cos
24、tDollar AmountConversionDirect labor and manufacturing overhead may be combined into one classification of product cost called conversion costs.Direct MaterialsDirect LaborDirect LaborManufacturing OverheadWeighted-Average An Example Smith Company reported the following activity in the Assembly Depa
25、rtment for the month of June:The first step in calculating the equivalent units is to identify the units completed and transferred out of Assembly Department in June (5,400 units)Weighted-Average An ExampleThe second step is to identify the equivalent units of production in ending work in process wi
26、th respect to materials for the month (540 units) and adding this to the 5,400 units from step one.Weighted-Average An ExampleWeighted-Average An ExampleThe third step is to identify the equivalent units of production in ending work in process with respect to conversion for the month (270 units) and
27、 adding this to the 5,400 units from step one.Equivalent units of production always equals: Units completed and transferred + Equivalent units remaining in work in processWeighted-Average An ExampleBeginning Work in Process 300 Units 40% CompleteEnding Work in Process 900 Units 660% Complete6,000 Un
28、its Started5,400 Units Completed5,100 Units Started and CompletedWeighted-Average An ExampleMaterials5,400 Units Completed 540 Equivalent Units900 60%5,940 Equivalent units of production6,000 Units Started5,400 Units Completed5,100 Units Started and Completed 270 Equivalent Units900 30%5,670 Equival
29、ent units of productionBeginning Work in Process 300 Units 20% CompleteEnding Work in Process 900 Units 30% CompleteWeighted-Average An ExampleConversionLearning Objective 3Compute the cost per equivalent unit using the weighted-average method.Beginning Work in Process Inventory: 400 units Materials
30、: 40% complete $6,119Conversion: 20% complete $3,920Production started during June 6,000 unitsProduction completed during June 5,400 unitsCosts added to production in JuneMaterials cost $ 118,621Conversion cost $ 81,130Ending Work in Process Inventory: 900 unitsMaterials: 60% completeConversion: 30%
31、 completeCompute and Apply CostsCompute and Apply CostsThe formula for computing the cost per equivalent unit is:Cost per equivalent unit=Cost of beginning Work in Process Inventory Cost added during the periodEquivalent units of production+ Here is a schedule with the cost and equivalent unit infor
32、mation.Compute and Apply CostsCompute and Apply Costs Here is a schedule with the cost and equivalent unit information.Learning Objective 4Assign costs to units using the weighted-average method.Applying CostsApplying CostsApplying CostsComputing the Cost of Units Transferred OutComputing the Cost o
33、f Units Transferred OutComputing the Cost of Units Transferred OutLearning Objective 5Prepare a cost reconciliation report.Reconciling CostsReconciling CostsOperation CostingOperation cost is a hybrid of job-order and process costing because it possesses attributes of both approachesOperation costin
34、g is commonly used when batches of many different products pass through the same processing department.Supplementary Notes for the Weighted Average MethodTo Summarize the Physical Flow of UnitsFor the weighted average calculation, the percentages of completion related to BWIP with respect to materia
35、l and conversion are not used.Compute the equivalent Units of ProductionFor the weighted average calculation, the Inputs information is not required for the remaining calculation.Summarize the Total Cost Incurred in the PeriodCompute the Cost per Equivalent UnitCalculate The Values Of Completed Good
36、s And Ending WIP InventoriesCheck Cost Reconciliation FIFO MethodAppendix 9AFIFO vs. Weighted-Average MethodThe FIFO method (generally considered more accurate than the weighted-average method) differs from the weighted-average method in two ways:The computation of equivalent units.The way in which
37、the costs of beginning inventory are treated.Learning Objective 6Compute the equivalent units of production using the FIFO method.Equivalent Units FIFO MethodLets revisit the Smith Company example. Here is information concerning the Assembly Department for the month of June.Equivalent Units FIFO Met
38、hodStep 1: Determine equivalent units needed to complete beginning Work in Process Inventory.Equivalent Units FIFO MethodStep 2: Determine units started and completed during the period.Equivalent Units FIFO MethodStep 3: Add the equivalent units in ending Work in Process Inventory.Beginning Work in
39、Process 300 Units 40% CompleteEnding Work in Process 900 Units 60% Complete6,000 Units Started5,100 Units Started and CompletedFIFO ExampleMaterials5,100 Units Completed 540 Equivalent Units900 60%5,820 Equivalent units of production 180 Equivalent Units300 60%Beginning Work in Process 300 Units 20%
40、 CompleteEnding Work in Process 900 Units 30% Complete6,000 Units Started5,100 Units Started and CompletedFIFO ExampleConversion5,100 Units Completed 270 Equivalent Units900 30%5,610 Equivalent units of production 240 Equivalent Units300 80%Equivalent Units: Weighted-Average vs. FIFOAs shown below,
41、the equivalent units in beginning inventory are subtracted from the equivalent units of production per the weighted-average method to obtain the equivalent units of production under the FIFO method.Learning Objective 7Compute the cost per equivalent unit using the FIFO method.Beginning work in proce
42、ss: 400 units Materials: 40% complete $6,119Conversion: 20% complete $3,920Production started during June6,000 unitsProduction completed during June5,400 unitsCosts added to production in JuneMaterials cost $ 118,621Conversion cost $ 81,130Ending work in process 900 unitsMaterials: 60% completeConve
43、rsion: 30% completeCost per Equivalent Unit - FIFOLets revisit the Smith Company Assembly Department for the month of June to prepare our production report.Cost per Equivalent Unit - FIFOThe formula for computing the cost per equivalent unit under FIFO method is:Cost per Equivalent Unit - FIFO$118,6
44、00 5,820$81,130 5,610Learning Objective 8Assign costs to units using the FIFO method.Applying Costs - FIFOStep 1: Record the equivalent units of production in ending Work in Process Inventory.900 units 60%900 units 30%Applying Costs - FIFOStep 2: Record the cost per equivalent unit.Applying Costs -
45、FIFOStep 3: Compute the cost of ending Work in Process Inventory.Cost of Units Transferred OutStep 1: Record the cost in beginning Work in Process Inventory.Cost of Units Transferred OutStep 2: Compute the cost to complete the units in beginning Work in Process Inventory.Cost of Units Transferred Ou
46、tStep 3: Compute the cost of units started and completed this period.Cost of Units Transferred OutStep 4: Compute the total cost of units transferred out.Learning Objective 9Prepare a cost reconciliation report using the FIFO method.Reconciling CostsReconciling CostsA Comparison of Costing MethodsIn a lean production environment, FIFO and weighted-average meth