2.13 Teddy Bar and Restaurant makes two types of Burgers: ASA burger and SIGA burger. Following is information about the company's cost structure when 1,000 burgers are produced and sold. There is no direct labor. Overhead ASA SIGA burger burger Per unit information: Sales price per burger Direct materials per burger Sales commission per burger Birr 8.00 Birr 8.00 Birr 2.00 Birr 2.25 Birr 0.50 Birr 0.50 Variable overhead Birr 500 Fixed costs: Fixed manufacturing overhead Fixed non-manufacturing Birr 2,000 overhead Birr 300 Required: Assuming that variable overhead costs are linear in the quantity of production, and assuming that 60% of sales are SIGA burger, and 40% of sales are ASA burger, calculate the breakeven point in unit.
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.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
