On July 31, the end of the first month of operations, Rhys Company prepared the following income statement, based on the absorption costing concept Sales (23,000 units) $1,104,000 Cost of goods sold Cost of goods manufactured Less ending inventory (5,000 units) Cost of goods sold Gross profit Selling and administrative expenses Income from operations Rhys Company Income Statement Variable Costing For the Month Ended July 31 a. Prepare a variable costing income statement, assuming that the feed manufacturing costs were $84,000 and the variable selling and administrative expenses were $60,000. In your computations, round unit costs to two decimal places and round final answers to the nearest dollar Variable cost of goods sold Fixed costs Income from operations 00 $889,000 158,750 100 0000 730,250 $373,750 131,000 $242,750
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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