Vista Company installed a standard cost system on January 1. Selected transactions for the month of January are as follows. Purchased 17,300 units of raw materials on account at a cost of $3.40 per unit. Standard cost was $3.10 per unit. Issued 17,300 units of raw materials for jobs that required 17,070 standard units of raw materials. Incurred 15,000 actual hours of direct labor at an actual rate of $4.60 per hour. The standard rate is $5.10 per hour. (Credit Factory Wages Payable.) 1 2. 3. 4 5. Performed 15,000 hours of direct labor on jobs when standard hours were 15,150. Applied overhead to jobs at the rate of 100% of direct labor cost for standard hours allowed.
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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