Your Company uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. At the beginning of the year, the company estimated its predetermined overhead rate to be $4 per direct labor hour since it estimated total manufacturing overhead cost at $400,000 and direct labor-hours at 100,000 hours. The actual overhead cost incurred during the year was $370,000 and the actual direct labor-hours incurred on jobs during the year was 90,000 hours. What is the difference between the applied manufacturing overhead and the actual manufacturing overhead? Group of answer choices $10,000 overapplied $10,000 underapplied $30,000 underapplied $30,000 overapplied
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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