Uncle Pete Snacks just received an order to produce 15,000 single-serving bags of gourmet, fancy-cut, sweet potato chips. The order will require 19 preparation hours and 35 cooking and draining hours. (Click the icon to view the relevant activity rates.) Read the requirements. 1. What is the total amount of manufacturing overhead that should be allocated to this order? Determine the basic formula needed to allocate overhead to this order, then compute the overhead allocated to each activity. Manufacturing Data table Activity Activity Cost Allocation Rate Preparation........ $ 25.00 Cooking and draining.... $ 25.00 Packaging..... $ 0.09 Cost Driver Preparation time Cooking and draining time Units packaged X overhead allocated Requirements Use the activity rates provided to compute the following: 1. What is the total amount of manufacturing overhead that should be allocated to this order? 2. 3. How much manufacturing overhead should be assigned to each bag? What other costs will the company need to consider to determine the total manufacturing costs of this order? X
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.
Uncle Pte
Snacks just received an order to produce
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
