are produced in the enterprise. During the relevant cost period, 8,000 units of product A, 5,000 units of B and 3,000 units of product C were produced. Distribution Method According to Physical Amounts will be taken as basis in the distribution of
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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The total combined expense amount incurred in the main production expense place in a production enterprise is 480.000 TL. Three combined products, A, B and C, are produced in the enterprise. During the relevant cost period, 8,000 units of product A, 5,000 units of B and 3,000 units of product C were produced. Distribution Method According to Physical Amounts will be taken as basis in the distribution of the combined expenses.According to the information above, what is the share of product B from the combined costs?
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In physical method, we allocate combined expenses in the ratio of unit produced of each product.
Total combined expenses - 480000
Total units produced - 16000 (8000+5000+3000)
Per unit expenses - 480000/16000 = 30 per unit
No. Of units of product B - 5000
Total expenses attributable to product B - 150000 (5000*30)
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