Lenni Clothing Co. manufactures clothing in a small manufacturing facility. Manufacturing has 25 employees. Each employee presently provides 40 hours of productive labor per week. Information about a production week is as follows: Standard wage per hr. $12.00 Standard labor time per unit 12 min. Standard number of yds. of fabric per unit 5.0 yds. Standard price per yd. of fabric $5.00 Actual price per yd. of fabric $5.10 Actual yds. of fabric used during the week 26,200 yds. Number of units produced during the week 5,220 Actual wage per hr. $11.80 Actual hrs. for the week 1,000 hrs.
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.
Lenni Clothing Co. manufactures clothing in a small manufacturing facility. Manufacturing has 25 employees. Each employee presently provides 40 hours of productive labor per week. Information about a production week is as follows:
| Standard wage per hr. | $12.00 |
| Standard labor time per unit | 12 min. |
| Standard number of yds. of fabric per unit | 5.0 yds. |
| Standard price per yd. of fabric | $5.00 |
| Actual price per yd. of fabric | $5.10 |
| Actual yds. of fabric used during the week | 26,200 yds. |
| Number of units produced during the week | 5,220 |
| Actual wage per hr. | $11.80 |
| Actual hrs. for the week | 1,000 hrs. |
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