Archimedes Graphics uses a special purpose paper in 80% of its jobs. The paper is purchased in 100-sheet packages at a cost of P100 per package. Management estimates that the cost of placing and receiving a typical order is P15, and the annual cost of carrying a package in inventory is P1.50. Cartwright uses 2.600 packages each year. Production is constant, and the lead time to receive an order is 1 week. The reorder point is: O 50 packages. O 203 packages. O 100 packages. 225 packages.
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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