49-Assume that XYZ LLc is producing 50000 units of Product A. The direct material cost per unit is OMR50, direct labour cost per unit OMR 20, direct labor hours per unit 2 hours, and machine hours per unit 3 hours. Production overhead split by departments are Department X OMR 1,200,000 and Department Y OMR 1,500,000. Total labour hours in Dept. X is 120,000; Total machine hours in Dept. Y 500,000. Identify the product cost per unit from the following given options based on Traditional costing method by assuming Department X is labor intensive and Y is machine intensive. O a. OMR 99 O b. OMR 120 O c. OMR 105 O d. OMR 110
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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