Fool Proof Kitchens manufacturers custom made self-cleaning professional grade food processors. The company pays its direct laborers $20 per direct labor hour and applies manufacturing overhead to jobs using a predetermined overhead rate of $4 per direct labor hour. On June 1, the company received an order from Monica Geller for one food processor. The order, or job, was completed and sold on June 30. During June, $160 of direct materials were used on the job and direct laborers worked 10 hours on the job. The company marks up product costs by 30% to determine sales price. What was the sales price of Monica's job?
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.
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