Q12: A company manufactures offices and the standard direct materials cost per office was 27 dinars based on the use of 12 square feet of Formica wood and during the period 10,000 offices were produced and 12,600 square feet of Formica were used in their production and the actual price was 2 dinars per square foot, meaning that Its total cost is 25200 dinars, so the deviation is the amount of direct materials during the period as follows: A - 1200 dinars (gm) B - 1350 dinars (gm) C- 1800 dinars (m) - 3150 dinars (m) (American Certified Public Accountants Association) explained That? e 10:58
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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