Units Cost $5,455 July $4,300 August $4,200 September $4,000 October $3,800 November $3,900 December Unit Cost |January February March 2,600 2,300 2,200 2,000 1,800 1,900 2,200 2,100 2,000 1,500 1,900 1,800 $4,400 $4,100 $3,800 $3,750 $3,700 $4,050 April May June REQUIRED Separate the variable and fixed elements, using the high-low method. 2. 1. Determine the variable cost to be charged to the product for the year. (Hint: First determine the number of annual units produced.) 3. Determine the fixed cost to be charged to factory overhead for the year.
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.
Miller Minerals Co. manufactures a product that requires the use of a considerable amount of natural gas to heat it to a desired temperature. The process requires a constant level of heat, so the furnaces are maintained at a set temperature for 24 hours a day. Although units are not continuously processed, management desires that the variable costbe charged directly to the product and the fixed cost to the factory
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