ance of fini "oys 20 fi ted ave a sing ded i ts fr ne 14) 11)Corp makes jackets and uses machine-hours as the single indirect-cost rate to allocate O/H. The following estimates are provided for the coming year for the company overall and for Job 101 specifically. Company Job 101 $40,000 $10,000 Manufacturing overhead costs $45,000 Machine-hours 100,000 mh Direct materials Direct labor $2,000 $400 900 mh What is the annual manufacturing overhead cost-allocation rate for Corp's entire company (plant-wide) rate? 12) What amount of O/H costs will be allocated to Job 101? 13) What are the total manufacturing costs of Job 101? 14) What is the bid price (price the company offers to do the work for) for the job if the company uses a 40% markup of total manufacturing costs? 15) Corp applies O/H to products at a budgeted indirect-cost rate of $60 per DLH. A retail outlet has requested a bid on a special order of a necklace. Estimates for this order include: DM of $50,000; 400 DLH at $20 per hour; and a 30% markup rate on total manufacturing costs. Estimated total product costs for this order equal employee is sional labor sis or-hours. g the allocation
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.
Plant-wide Overhead Rate :— It is the rate used to allocate manufacturing overhead to cost object under conventional costing system.
It is calculated by dividing total estimated overhead cost by estimated usage of cost allocation base.
Total Manufacturing Cost :— It is the sum of direct materials, direct labour and manufacturing overhead applied.
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