23. A company’s total overhead cost at various levels of activity is presented below: Month Machine-Hours Total Overhead Cost March ...................................... 5,000 $21,750 April ......................................... 4,000 $19,000 May ......................................... 6,000 $25,000 June ........................................ 7,000 $28,750 Assume that the overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 4,000 machine-hour level of activity is as follows: Utilities (variable) ............................... $ 8,000 Supervisory salaries (fixed) ................. 4,000 Maintenance (mixed) .......................... 7,000 Total overhead cost ............................ $19,000 Suppose the company uses the high-low method to estimate a cost formula for maintenance. What is the total maintenance cost the company expects to incur at an activity level of 7,600 machine hours? a. $12,640 b. $13,400 c. $12,800 d. $11,500 e. None of the above
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.
23. A company’s total
What is the total maintenance cost the company expects to incur at an activity level of 7,600 machine hours? a. $12,640 b. $13,400 c. $12,800 d. $11,500 e. None of the above
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