Poshey enterprise had the following predetermined overhead rates for its three departments which produces delicious package stew for the local market targeting mainly students on tertiary institutions, bachelors, and spinsters. The predetermined rates are as follows: Kitchen - 15% of direct labour cost Packaging - GHc 15.00 per machine hour Dispatch - GHc 10.00 per direct labour hour The cost sheet for order number 007 is stated below: Kitchen Packaging Dispatch Direct Materials (GHc) 25,000 10,000 2,000 Direct Labour: 200hrs@GHc35 80hrs@GHc30 40hrs@GHc25 Machine hours - 160 - You are required to compute the price quoted for order number 007 if Poshey Enterprise desire profit on sales at 25%.
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.
Poshey enterprise had the following predetermined
which produces delicious package stew for the local market targeting mainly students on
tertiary institutions, bachelors, and spinsters. The predetermined rates are as follows:
Kitchen - 15% of direct labour cost
Packaging - GHc 15.00 per machine hour
Dispatch - GHc 10.00 per direct labour hour
The cost sheet for order number 007 is stated below:
Kitchen Packaging Dispatch
Direct Materials (GHc) 25,000 10,000 2,000
Direct Labour: 200hrs@GHc35 80hrs@GHc30 40hrs@GHc25
Machine hours - 160 -
You are required to compute the price quoted for order number 007 if Poshey Enterprise desire
profit on sales at 25%.
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