Gold Shoes Company manufactures cleats for baseball shoes. It has outlined the following overhead cost drivers: Overhead Cost Pool Quality Control Machine Time Materials Handling Miscellaneous Overhead Cost Number of Batches Direct Labor Hours Gold Shoes Company has an order for cleats that has the following production requirements: Number of Inspections Number of Machine hours Multiple Choice $28,950. Using activity-based costing, applied quality control factory overhead for the baseball cleat order is: $30,720. $33,750. Cost Driver Number of inspections Machine hours Number of Batches Direct labor hours $21,650. $20,100. Overhead Cost Budgeted Level for Cost Driver $ 60,000 173,420 450 270 8 1,080 3,750 68,000 Budgeted 800 667 75 6,600
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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