X Company manufactures a single product. Monthly production costs incurred in the manufacturing process are shown below for the production of 24,000 units and 72,000 units. Assume that $1,200 of the factory maintenance cost and $950 of plant utilities were fixed cost. 24,000 units 24,000 72,000 un its 24,000 Cost Depreciation on plant equipment Direct labor 600,000 1,800,000 Direct material 768,000 553,200 2,304,000 1,657,200 1,152,000 32,000 Factory maintenance Indirect material 384,000 Plant manager salaries Property taxes on plant 32,000 9,000 9,000 Plant utilities 288,950 864,950
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.
4)Based on the above, calculate the total expected cost when the company produces 60,000 units: *
A)$5,222,150
B)$6,547,150
C)$3,487,150
D)None of the above
![X Company manufactures a single product. Monthly production costs incurred in
the manufacturing process are shown below for the production of 24,000 units
and 72,000 units. Assume that $1,200 of the factory maintenance cost and $950
of plant utilities were fixed cost.
24,000
units
24,000
72,000
un its
Cost
Depreciation on plant equipment
24,000
1,800,000
Direct labor
600,000
Direct material
768,000
2,304,000
Factory maintenance
553,200
1,657,200
Indirect material
384,000
32,000
1,152,000
Plant manager salaries
Property taxes on plant
32,000
9,000
9,000
Plant utilities
288,950
864,950](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd28a48f8-ed8c-4f2d-ac3a-2ddd1708b849%2F1fc83472-e7d4-48e8-88ca-94a5c1b83442%2F4t69bxk_processed.png&w=3840&q=75)
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