The following information is available pertaining to the Production Division of Clark Quay Pte Ltd: Assembly Dept. Finishing Dept. Total Overhead costs $7,500 $22,500 $30,000 Direct labour hours 7,500 2,500 10,000 Machine hours 2,500 7,500 10,000 Production information pertaining to Job 4X4: Assembly Dept. Finishing Dept. Total Prime costs $1,250 $-0- $1,250 Direct labour hours 250 -0- 250 Overhead is absorbed using direct labour hours. What is the cost of Job 4X4? Question 3 options: 1) $1,250 2) $2,000 3) $8,750 4) $31,250
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 following information is available pertaining to the Production Division of Clark Quay Pte Ltd:
| Assembly Dept. | Finishing Dept. | Total |
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| $7,500 | $22,500 | $30,000 |
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| Direct labour hours | 7,500 | 2,500 | 10,000 |
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| Machine hours | 2,500 | 7,500 | 10,000 |
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| Production information pertaining to Job 4X4: | |||||||
| Assembly Dept. | Finishing Dept. | Total | |||||
| Prime costs | $1,250 | $-0- | $1,250 | ||||
| Direct labour hours | 250 | -0- | 250 | ||||
Overhead is absorbed using direct labour hours. What
is the cost of Job 4X4?
Question 3 options:
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