Department Cost Personnel Security Maintenance Cutting Sewing Finishing Personnel 1,000,000 10% 10% 30% 30% 10% Security Maintenance 100,000 400,000 10% 10% 30% 20% 30% 10% 10% 40$ 20% 20% Cutting Sewing 800,000 1,200,000 Finishing Direct 660,000 P1,850,000 P50,000 P780,000 material Direct labor P2,550,000 P1,740,000 P700,000 Actual FOH P300,000 P500,000 P700,000
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.
Please show your computations through excel.
c. Compute the total service cost allocated to cutting department using RECIPROCAL method.
Step by step
Solved in 4 steps with 3 images
