Comfort Shoes Manufacturing Company began business on January 1, 2016. During its first year of operation, Comfort Shoes worked on 5 jobs, and reported the following information at year-end: Job # Manufacturing 0/H Applied $15,000 60,000 Direct Direct Materials Labour $45,000 75,000 40,000 35,000 $85,000 200,000 130,000 101 102 103 25,000 104 120,000 75,000 105 15,000 8,000 2,000 • Actual manufacturing overheads incurred on Jobs 101 – 105 during the period amounted to $189,000. • Jobs 101 – 104 were completed and transferred out to Finished Goods Inventory. • Jobs 101 & 102 were sold for $250,000 & $390,000 respectively. At year-end, what was the balance in Finished Goods Inventory? a. $905,000 O b. $195,000 O c. $450,000 O d. $425,000
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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