1. Managerial Accounting
Chapter 4

2. Job-order Costing vs. Process Costing
Similarities
Same basic purpose exists
Use same basic manufacturing accounts
Flow of costs are basically the same
Differences
The flow of goods in the process costing situation are essentially indistinguishable and continuous through the manufacturing process.
Costs are accumulated by department, rather than by individual job.
Use a department production report rather than a job-cost sheet.

3. Process costing methods
Only 2 are covered in text
Weighted average
FIFO

4. Equivalent Units of Product
Equivalent units in the ending work in process inventory = Number of partially completed units x % complete
Weighted Average method
Equivalent units of product = Units transferred to next department or to finished goods + Equivalent units in the ending work in process inventory

5. Production Report
Purpose – summarize all of the activity that takes place in a department’s work in process.
Consists of three parts:
Quantity schedule and computation of equivalent units
Computation of costs per equivalent unit
Reconciliation of all cost flows into and out of the department