e completed, and the following costs were incurred: Job 401 Job 402 P 37,000 23,000 6,000 Direct materials Direct labor - regular P 28,000 18,000 overtime premium er factory costs for the month totaled P 16,800. Factory overhead costs are allo I to Job 401 and two-thirds to Job 402. wired: a) Describe two alternative methods of recording the overtime premium and exp
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.
![Problem 1. The Evergreen Company produces tools on a job order basis. During May, two jobs
were completed, and the following costs were incurred:
Direct materials
Direct labor - regular
Job 401
P 28,000
18,000
Job 402
P 37,000
23,000
6,000
overtime premium
Other factory costs for the month totaled P 16,800. Factory overhead costs are allocated one-
third to Job 401 and two-thirds to Job 402.
Required:
a) Describe two alternative methods of recording the overtime premium and explain how the
appropriate method affect the cost of each job.
• b) Compute the cost of Job 401 and Job 402 under each of the two methods.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb34b8d01-d514-4a6f-a9be-a5e9e9b0ed67%2Fe5ce5e7e-2a31-4ca0-8604-198762081d50%2Fd06ldy_processed.jpeg&w=3840&q=75)
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