Banks Corporation has the following information for direct materials for the latest period. BANKS CORPORATION INFORMATION FOR DIRECT MATERIALS FOR THE LATEST PERIOD Standard price per unit of direct materials $ 15.00 Actual price per unit of direct materials $ 16.50 Budgeted units of output 45,000 Standard quantity of direct materials allowed per unit 3 units of output Actual units of direct materials used 40,000 Actual units of direct materials purchased Actual units of output produced 50,000 14,000 The company calculates its price variance based on quantity purchased. What is the direct materials price variance?
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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