Machining Department Assembly Department Manufacturing overhead Direct manufacturing labor costs Direct manufacturing labor-hours $1,500,000 $5,100,000 $1,600,000 $3,000,000 120,000 280,000 Machine-hours 30,000 270,000 1. Present an overview diagram of Matthew's job-costing system. Compute the budgeted manufacturing overhead rate for each department. 2. During February, the job-cost record for Job 494 contained the following: Required Machining Department $42,000 Assembly Department Direct materials used $78,000 Direct manufacturing labor costs Direct manufacturing labor-hours $15,000 $19,000 1,100 1,300 Machine-hours 2,800 1,100 Compute the total manufacturing overhead costs allocated to Job 494. 3. At the end of 2017, the actual manufacturing overhead costs were $1,800,000 in machining and $5,300,000 in assembly. Assume that 33,000 actual machine-hours were used in machining and that actual direct manufacturing labor costs in assembly were $3,200,000. Compute the over- or underal- located manufacturing overhead for each department.
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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