Analyse the costs! (Cost difference)
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.
Cost Inc company planned their output 60,000 Hours, while the actual output was 63,000 Hours. They planned 150,000 EUR (From this 50,000 EUR is fixed cost.) costs, and they recorded 160,000 EUR on the base of actual transactions. In the reference period there were 66 working days. The company has 5 machines and two production plans. The book value of machines is 40,000 EUR and the book value of the two buildings is 201,567 EUR. In this unit controlling uses simple cost calculation!
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Analyse the costs! (Cost difference)
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