Quiz Company produces four products from a common input. Joint costs to produce one batch total $130,000. All products can either be sold at the split-off point or processed further. Information for one batch of the joint products is as follows Product 1 Product 2 Product 3 Product 4 Gallons 1,400 2.600 2,500 3,500 Weight Factor 10 2.0 1.5 2.5 Sales Price At Split Off $15/gal 20 26 35 Additional Processing Cost $2/gal 4 5 5 Processed Sales Value $20/gal 25 30 40 Note: Round all allocation ratios to four decimal points Round all dollar amounts to the nearest dollar. Determine the amount of joint costs allocated to Product 1 using the physical units method Note: Give your answer using dollar signs and commas but no decimal points (cents)
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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