Lucy Sportswear manufactures a line of specialty T-shirts using a job order costing system. In March the company incurred the following costs to complete Job ICU2: direct materials, $19,200, and direct labor, $5,200. The company also incurred $1,200 of administrative costs and $2,400 of selling costs to complete this job. Job ICU2 required 1,200 machine hours. Factory overhead was applied to the job at a rate of $30 per machine hour. If Job ICU2 resulted in 4,000 good shirts, what was the cost of goods sold per shirt? (Round answer to 1 decimal place, e.g. 3.5.) Cost per shirt $ __________________
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.
Lucy Sportswear manufactures a line of specialty T-shirts using a
If Job ICU2 resulted in 4,000 good shirts, what was the cost of goods sold per shirt? (Round answer to 1 decimal place, e.g. 3.5.)
| Cost per shirt | $ __________________ |
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