High Tech Manufacturing Inc., incurred total indirect manufacturing labor costs of $480,000. The company is labor intensive. Total labor hours during the period were 4,400. Using qualitative analysis, the manager and the management accountant determine that over the period the indirect manufacturing labor costs are mixed costs with only one cost driver–labor-hours. They separated the total indirect manufacturing labor costs into costs that are fixed ($130,000 based on 8,100 hours of labor) and costs that are variable based on the number of labor-hours used. The company has estimated 7,700 labor hours during the next period. What will be the total cost for the estimated 7,700 hours? (Round any intermediary calculations to the nearest cent and your final answer to the nearest dollar.) Question 2 options: $586,296 $742,535 $462,716 $840,000
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.
VARIABLE COST
Variable Cost is a cost that varies with the level of output.
Variable Costs include costs of goods sold (COGS), raw materials and inputs to production, packaging, wages, etc.
FIXED COST
Fixed costs are costs that Constant at any level of Activity.
Fixed Costs are rent and lease costs, salaries, utility bills, insurance, loan repayments, Depreciation, Advertisement etc
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