The Larry plant has two categories of overhead: maintenance and inspection. Costs expected for these categories for the coming year are as follows: Maintenance - P100,000; Inspection - P150,000. The plant currently applies overhead using direct labor hours and expected capacity of 50,000 direct labor hours. The following data have been assembled for use in developing a bid for a proposed job: (refer to image) Total expected machine hours for all jobs during the year is 25,000, and the total expected number of inspections is 1,500.Using activity-based costing and the appropriate activity drivers, the total cost of the potential job would be * Diest maleriais P1.000 P4.C00 500 Direct lubur Mschine houre Number of inspections Direct labor hours 800 a. P2,400 b. P3,600 c. P7,400 O d. P7,750
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 Larry plant has two categories
of overhead: maintenance and
inspection. Costs expected for
these categories for the coming
year are as follows: Maintenance -
P100,000; Inspection - P150,000.
The plant currently applies
overhead using direct labor hours
and expected capacity of 50,000
direct labor hours. The following
data have been assembled for use
in developing a bid for a proposed
job: (refer to image) Total expected
machine hours for all jobs during
the year is 25,000, and the total
expected number of inspections is
1,500.Using activity-based costing
and the appropriate activity drivers,
the total cost of the potential job
would be *
Nimet malerials
Direcd lubor
Mechine houre
Number of inspections
Niret labor hours
P1 C00
P4.000
600
800
O a. P2,400
О Б. Р3,600
c. P7,400
O d. P7,750](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F52c24589-b008-486e-8024-a72804ece941%2Fb7ed2f03-5967-4a1d-bc7a-856259295ee3%2Fzciutv1_processed.jpeg&w=3840&q=75)
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