10. James Company produces basketballs. James predicts total sales of 100,000 basketballs during the first quarter at $80 per basketball. They have developed the following standard cost data for use in determining the cost of producing a basketball: Materials: Leather (1 unit x $10). Rubber (2 units x S2). Direct Labor (1 hour x $15). Variable Overhead During the first quarter, James expects fixed overhead costs of $50.000 and nonmanufacturing costs of $120,000. Their beginning inventories consisted of 500 units of leather, 1,500 units of rubber, and 10,000 basketballs. James wishes to increase all of these inventories by 10% during the first quarter. Required: Prepare the following budgets in good form. a. Production $10.00 4.00 15.00 7.50 $36.50 b. Direct Materials c. Direct Labor A Manufacturing Overhead
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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