(b) What is the product margin under the traditional costing system when the number of orders increases to 9? (Enter a loss a negative amount.) Product margin under the traditional costing system
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.
![2. Assume that OfficeMart places orders more frequently, but everything else remains the same. On your worksheet increase the
number of orders from 4 to 9. (Prior to completing this requirement, change all worksheet figures back to their original amounts.)
A
1 Chapter 7: Applying Excel
2
3
4
5
6
7
Data
Manufacturing overhead
Selling and administrative overhead
8 Manufacturing overhead
9
10
11
12
13 OfficeMart orders:
14 Customers
15 Orders
16 Number of filing cabinets ordered in total
17 Selling price
18
19 Direct labor
Selling and administrative overhead
Total activity
Direct materials
Product margin under the traditional costing system
B
$
500,000
$ 300,000
Assembling
Units
$
$
$
50%
10%
1,000
units
C
Processing
Orders
1 customer
9 orders
80 units
595
180
50
35%
45%
250
orders
D
Supporting
Customers
5%
25%
100
customers
E
Other
10%
20%
(b) What is the product margin under the traditional costing system when the number of orders increases to 9? (Enter a loss as a
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