Finch Company began its operations on March 31 of the current year. Finch has the following projected costs: April May June Manufacturing costs* $156,800 $195,200 $217,600 Insurance expense** 1,000 1,000 1,000 Depreciation expense 2,000 2,000 2,000 Property tax expense*** 500 500 500 *Of the manufacturing costs, three-fourths is paid for in the month they are incurred; one-fourth is paid in the following month.
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.
Finch Company began its operations on March 31 of the current year. Finch has the following projected costs:
| April | May | June | |
| $156,800 | $195,200 | $217,600 | |
| Insurance expense** | 1,000 | 1,000 | 1,000 |
| 2,000 | 2,000 | 2,000 | |
| Property tax expense*** | 500 | 500 | 500 |
*Of the manufacturing costs, three-fourths is paid for in the month they are incurred; one-fourth is paid in the
following month.
**Insurance expense is $1,000 a month; however, the insurance is paid four times yearly in the first month of the
quarter (i.e., January, April, July, and October).
***Property tax is paid once a year in November.
The cash payments expected for Finch Company in the month of April are
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