Vero, Inc. began operations at the start of the current year, having a production target of 68,000 68,000 units, and the company sold 95% of its manufacturing output at $50 per unit. The follow Manufacturing: Direct materials used Direct labor Variable manufacturing overhead Fixed manufacturing overhead Selling and administrative: Variable Fixed $256,000 456,000 376,000 816,000 188,000 638,000
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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![Vero, Inc. began operations at the start of the current year, having a production target of 68,000 units. Actual production totaled
68,000 units, and the company sold 95% of its manufacturing output at $50 per unit. The following costs were incurred:
Manufacturing:
Direct materials used.
Direct labor
Variable manufacturing overhead
Fixed manufacturing overhead
Selling and administrative:
Variable
Fixed
A.
B.
C.
D.
$256,000
456,000
376,000
816,000
Required:
A. Assuming the use of variable costing, compute the cost of Vero's ending finished-goods inventory.
B. Compute the company's contribution margin. Would Vero disclose the contribution margin on a variable-costing income statement
or an absorption-costing income statement?
C. Assuming the use of absorption costing, how much fixed selling and administrative cost would Vero include in the ending finished-
goods inventory?
D. Compute the company's gross margin.
188,000
638,000
Ending finished-goods inventory
Contribution margin
Fixed selling and administrative cost
Gross margin
X Answer is not complete.
$ 54,400✔
$ 2,008,400 Variable-costing
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