Weisman, Inc. uses activity-based costing as the basis for information to set prices for its six lines of seasonal coats. Estimated Overhead Expected Use of Cost Drivers per Activity Activity Cost Pools Designing $442,000 14,700 designer hours Sizing and cutting 4,090,000 167,000 machine hours Stitching and trimming 1,470,000 78,000 labor hours Wrapping and packing 322,000 30,000 finished units Compute the activity-based overhead rates using the following budgeted data for each of the activity cost pools. (Round answers to 2 decimal places, e.g. 12.25.) Activity-based overhead rates Designing per designer hour Sizing and cutting per machine hour $ Stitching and trimming per labor hour Wrapping and packing $ per finished unit
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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