Budget for 2017 Actual Results for 2017 Direct material costs Direct manufacturing labor costs Manufacturing overhead costs $2,250,000 $2,150,000 1,650,000 1,700,000 3,060,000 3,217,500 1. Compute the actual and budgeted manufacturing overhead rates for 2017. 2. During March, the job-cost record for Job 626 contained the following information: Required Direct materials used Direct manufacturing labor costs Compute the cost of Job 626 using (a) actual costing and (b) normal costing. $55,000 S45,000 3. At the end of 2017, compute the under- or overallocated manufacturing overhead under normal costing. Why is there no under- or overallocated manufacturing overhead under actual costing? 4. Why might managers at Dakota Products prefer to use normal costing?
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.
Actual costing, normal costing, accounting for manufacturing
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