Kate's Kale Chips produces a healthy snack made primarily of kale. Each bag of the product sells for $5. The company computes the manufacturing overhead rate on a quarterly basis based upon the planned number of units to be produced that quarter. The following data are from the projections of Kate's Kale Chips for the upcoming quarter: Sales Production Variable manufacturing cost per bag Sales and distribution costs per bag Total fixed manufacturing overhead Fixed administrative overhead Projections 24,500 bags 26,500 bags $ 2.90 $ 0.60 $ 31,800 $ 22,500 Required: 1. Compute the projected product cost per bag produced under full costing. 2. Compute the projected product cost per bag under variable costing. (Round your answers to 2 decimal places.)
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.
![Exercises 18-42 (Algo) Product Cost under Full vs. Variable Costing [LO 18-4]
Kate's Kale Chips produces a healthy snack made primarily of kale. Each bag of the product sells for $5. The company
computes the manufacturing overhead rate on a quarterly basis based upon the planned number of units to be produced
that quarter. The following data are from the projections of Kate's Kale Chips for the upcoming quarter:
Sales
Production
Variable manufacturing cost per bag
Sales and distribution costs per bag
Total fixed manufacturing overhead
Fixed administrative overhead
Projections
24,500 bags
26,500 bags
$ 2.90
$ 0.60
1. Product cost under full costing
2. Product cost under variable costing
$ 31,800
$ 22,500
Required:
1. Compute the projected product cost per bag produced under full costing.
2. Compute the projected product cost per bag under variable costing.
(Round your answers to 2 decimal places.)
per bag
per bag](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F08138c1b-b13f-4cc9-90fc-4bc24dd3dae9%2F6df7595c-8089-440c-8391-197d312c24e1%2Fkel5k79_processed.jpeg&w=3840&q=75)
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