V Company uses job order costing and had a balance in Work-in-Process Inventory on January 1 of $141,800. Direct materials used in January were $174,500. Direct labor used in January was $162,500. Overhead is applied at a rate of 140 percent of direct labor dollars. The following jobs were completed in January: Job #84 had a total cost of $198,780. Job #85 had a total cost of $102,520. Job #86 had a total cost of $119,450. Job #87 had a total cost of $93,150. The only job not finished at the end of January was Job #88 that had $72,400 of material cost to date. How much overhead had been applied to Job 88? a. $67,420 b. $94,390 c. $70,000
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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