Man City Enterprises commenced operations on 1 January 2022, and produces a single product that sells for R36 per unit. During 2022, 300 000 units of the product were manufactured of which 240 000 units were sold. There was no work-inprocess inventory at the end of the year. All costs are presented in the table below: Cost type Direct materials Direct labour Factory overhead Marketing and administrative Fixed R600 000 R300 000 Variable R6.00 per unit produced R4.00 per unit produced R2.00 per unit produced R1.00 per unit sold Required: Prepare the income statement using the Marginal Costing method for the year ended 31 December 2022.
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.
A 80.
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