ted on December 15, 20x5. Additional data are as follows: 20x4 20x5 Actual costs incurred Esimated remaining costs Billed to customer Received from customer 1,350,000 1,525,000 1,350,000 1,200,000 2,300,000 1,000,000 2,400,000 Under the cost recovery method, what amount should Gates recognize as gross proft for 20x5? a 225,000 475,000 b 312,000 d
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.
During 20x4, Gates corp. started a construcfion job with a total contract price of P3,500,00. The job was completed on December 15, 20x5. Additional data are as follows: 20x4 20x5 Actual costs incurred Esimated remaining costs Billed to customer Received from customer 1,350,000 1,525,000 1,350,000 1,200,000 2,300,000 1,000,000 2,400,000 Under the cost recovery method, what amount should Gates recognize as gross proft for 20x5? a 225,000 475,000 b 312,000 d None of the above
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