During the month of April 20X1 Winston Ltd. produce 6,700 dodgits. The cost of the materials in these dodgits was $48,240. Each dodgit used 4 kg of the material and it cost $1.80 per kg during the month. The standards for the production of dodgits for April were 4.2 kg of material per dodgit at a price of $1.60 per kg. The anticipated production for the month had been 6,500 dodgits. Using the reconciliation type of variance report, reconcile the standard cost and actual cost of the materials for dodgits for this period.
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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