The actual selling expenses incurred in March 2022 by Sheffield Company are as follows. Variable Expenses Fixed Expenses Sales commissions $12,100 Sales salaries $38,500 Advertising 7,590 Depreciation 7,700 Travel 5,610 Insurance 1,100 Delivery 3,795 Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 4%, travel 3%, and delivery 2%. Fixed selling expenses will consist of sales salaries $38,500, Depreciation on delivery equipment $7,700, and insurance on delivery equipment $1,100. (a) Prepare a flexible budget performance report for March, assuming that March sales were $187,000. (List variable costs before fixed costs.)
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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