Daston Company manufactures two products, Product F and Product G. The company expects to produce and sell 1,600 units of Product Fand 3,000 units of Product G during the current year. Data relating to the company's three activity cost pools are given below for the current year. Activity Cost Pools Total Cost Total Activity Product F Product G Total Machine setups $ 14,960 130 setups 90 220 setups Purchase orders $ 63,360 650 orders 1,110 orders 1,760 orders Order size $ 32,240 1,280 hours 1,200 hours 2,480 Required: Using the activity-based costing approach, determine the overhead cost per unit for each product
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.
Daston Company manufactures two products, Product F and Product G. The company expects to produce and sell 1,600 units of Product Fand 3,000 units of Product G during the current year. Data relating to the company's three activity cost pools are given below for the current year. Activity Cost Pools Total Cost Total Activity Product F Product G Total Machine setups $ 14,960 130 setups 90 220 setups Purchase orders $ 63,360 650 orders 1,110 orders 1,760 orders Order size $ 32,240 1,280 hours 1,200 hours 2,480 Required: Using the activity-based costing approach, determine the
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