The Information bellow has been taken from production department of XYZ Company for December is as follows: Total Costs OMR 200000 Labour used in Production 150000 | Variable Cost 200000 Fixed Cost Material used in Production 100000 50000 (Assembly and supervisor) Production Facilities cost rent general, utilities,..) Total production cost (50000 40000 10000 400000 | 340000 60000 Calculate: A. If 8000 units is produced during the month calculate cost per unit. B. Describe the production costs in the equation form Y = f+ vX. C. Assume XYZ Company intends to produce 12500 units next month. Calculate total production costs for the month.
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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