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Chapters 1-6
process operating
mass production of similar products in a flow of sequential processes.
process costing system
measures costs per equivalent unit at period-end. Each process has a separate WIP inventory account.
conversion costs
direct + Applied factory overhead
equivalent units
number of whole units that could have been. started and compelted given the costs incurred. Compute separately for dircet materials and conversion costs.
weigthed average
combines units and costs across two periods in computing EUP
Weighterd average computations
EUP= Equivalent units completed and transferred out + Equivalent units in ending work in process
Cost per EUP (WA)
costs of beg. WIP + Costs added this period / Equivalent units of production
FIFO
based on current-period production activity
FIFO Computations
EUP = Equivalent units to complete beg. WIP + Units started and completed + Equivalent units in ending WIP
FIFO Comp.
Cost per EUP (FIFO) = Costs added this period / equivalent units of production
Note
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