Chemical Mix SP Standard Cost SO. 200 $ 40.00 42.50 Echol 200 liters Protex 100 0.425 Benz 250 0.150 37.50 СТ-40 50 0.300 15.00 Total 600 liters $135.00 Chemical Quantity Used 26,600 liters 12,880 37,800 7,140 84,420 liters Echol Protex Benz СТ-40 Total
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.
energy Products Company produces a gsoline additive, Gas Gain.This product increases engine efficiency and improves gasoline mileage by creating a more complete burn in the combustion process.
Careful controls are required during the production process to ensure that the proper mix of input chemicals is achieved and that evaporation is controlled. If the controls are not effective , there can be a loss of output and efficiency.
The
The quantities of chemicals purchased and used during the current production period are shown in the following schedule. A total of 140 batches of Gas Gain were manufactured during the current production period.Energy Products determines its cost and chemical usage variations at the end of each production period.
Required:
Compute the total direct materials usage variance, and then break down this variance into its mix and yield components. (CMA adapted)
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