Lakeside Inc. manufactures four lines of remote control boats and uses activity-based costing to calculate product cost. Activity Cost Pools Estimated Total Cost Estimated Cost Driver Machining $ 321,000 13,400 machine hours Setup 72,000 300 batches Quality control 100,000 730 inspections Suppose the Luxury boat requires 5,450 machine hours, 295 inspections, and 69 batches. Using activity proportions, determine the amount of overhead assigned to the Luxury product line. How would i work this problem i keep getting machine hours wrong?
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.
Lakeside Inc. manufactures four lines of remote control boats and uses activity-based costing to calculate product cost.
| Activity Cost Pools | Estimated Total Cost | Estimated Cost Driver | ||
| Machining | $ | 321,000 | 13,400 | machine hours |
| Setup | 72,000 | 300 | batches | |
| Quality control | 100,000 | 730 | inspections | |
Suppose the Luxury boat requires 5,450 machine hours, 295 inspections, and 69 batches. Using activity proportions, determine the amount of
How would i work this problem i keep getting machine hours wrong?
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