The Baratheon Company is a manufacturer of golf clothing. During the month, the company cut and assembled 10,000 golf jackets. One hundred of jackets did not meet specifications and were considered “seconds”. Seconds are sold for P1,000.00 per jacket, whereas first quality jackets sell for P2,500.00. During the month, Work in Process was charged for P3,600,000 of materials, P4,000,000 of labor and factory overhead is applied at 120% of direct labor (including allowance of 20% of direct labor for spoiled units) Compute the unit cost of the good units if (round-off your answers to 2 decimal places) Loss is due to spoiled work spread over all jobs
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.
The Baratheon Company is a manufacturer of golf clothing. During the month, the company cut and assembled 10,000 golf jackets. One hundred of jackets did not meet specifications and were considered “seconds”. Seconds are sold for P1,000.00 per jacket, whereas first quality jackets sell for P2,500.00. During the month, Work in Process was charged for P3,600,000 of materials, P4,000,000 of labor and factory
Compute the unit cost of the good units if (round-off your answers to 2 decimal places)
Loss is due to spoiled work spread over all jobs
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