Harvest Bakery sells dinner rolls and multigrain bread. The company needs to determine the cost of two work orders for the month of July. Work Order 215 is for 2,400 packages of dinner rolls and Work Order 216 is for 2,800 loaves of multi- grain bread. The following information shows the different operations used by the two work orders: Operations 1. Bake 2. Shape loaves 3. Cut rolls Work Order 215 Use Do not use Use Work Order 216 Use Use Do not use Harvest For July, Bakery budgeted that it would make 9,600 packages of dinner rolls and 13,000 multigrain loaves (with associated direct materials costs of $5,280 and $11,700, respectively). Budgeted conversion costs for each operation in July were: Baking, $18,080; Shaping, $3,250; and Cutting, $1,440. Using the budgeted number of packages as the denominator to calculate the budgeted conversion- cost rates for each operation, what is the budgeted cost of goods manufactured for Work Order 215?
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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