Curtis Incorporated uses a job order cost system. Manufacturing overhead is applied on the basis of direct labor cost. Total manufacturing overhead was estimated to be $37,825 for the year, direct labor was estimated to total $151,300 Additional information for the year is as follows Raw Materials Inventory Work in Process Inventory Finished Goods Inventory Raw materials purchases Direct materials used i Direct labor Indirect materials used Indirect labor Factory equipment depreciation Factory rent Factory utilities Other factory costs Required: Beginning Inventory (1/1) $ 10,400 22,400 34,900 Ending Inventory (12/31) a. Calculate the predetermined overhead rate b. Calculate cost of goods manufactured $ 14,200 18,300 40,100 $ 103,000 92,300 148,000 6,900 15,900 25,500 18,300 9,500 7,000
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
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