Dake Corporation's relevant range of activity is 2,300 units to 5,500 units. produces and sells 3,900 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Calor commissions Average Cost per Unit $ 6.80 $ 4.00 $ 1.55 $ 2.50 $ 1.15 $ 0.85 $0.95
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.
Lets understad the basics.
Cost are divided into two types which are product cost and period cost.
Product cost is a cost which are incur to produce good or providing services. It includes costs like material, labor, variable and fixed manufacturing overhead
On other hand period cost is a all cost other than product cost. It includes cost like selling and administrative costs.
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