Process Costing Learning Objectives Show
Chapter Outline 1. CHARACTERISTICS OF PROCESS MANUFACTURING
2. THE IMPACT OF WORK-IN-PROCESS INVENTORIES ON PROCESS COSTING
3. WEIGHTED AVERAGE COSTING
4. MULTIPLE INPUTS AND MULTIPLE DEPARTMENTS
5. APPENDIX: PRODUCTION REPORT—FIFO COSTING
How do you calculate weighted average unit cost?To calculate the weighted average cost, divide the total cost of goods purchased by the number of units available for sale. To find the cost of goods available for sale, you'll need the total amount of beginning inventory and recent purchases.
How is weighted average process cost calculated?When using the weighted average method, you divide the cost of goods available for sale by the number of units available for sale, which yields the weighted-average cost per unit. In this calculation, the cost of goods available for sale is the sum of beginning inventory and net purchases.
How do you calculate unit cost in process costing?Calculate cost per unit: Divide the total cost by the number of units. This calculation includes both completed units and equivalent units. So, if a business completed 4,000 products and another 1,000 units got halfway through production, the applicable costs would be divided by 4,000 + (1,000/2) = 4,500 units.
What is the weighted average cost method?What is Weighted Average Cost (WAC)? In accounting, the Weighted Average Cost (WAC) method of inventory valuation uses a weighted average to determine the amount that goes into COGS and inventory. The weighted average cost method divides the cost of goods available for sale by the number of units available for sale.
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