Digital Fingers Glovers bought 378 pairs of gloves at $26 per pair. 220 pairs were sold in the first month, at the regular price of $42 per pair. Another 64 pairs were sold in the second month at a "one-third-off" the regular selling price. The remaining gloves were cleared out in the third month at $16.68. The store's overhead is 17% of cost. 1. What were the total sales? 2. What was the effective rate of markup as a percent of cost? 3. What was the total operating profit or loss on the sale of all of the gloves?
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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Scenario:
Digital Fingers Glovers bought 378 pairs of gloves at $26 per pair. 220 pairs were sold in the first month, at the regular price of $42 per pair. Another 64 pairs were sold in the second month at a "one-third-off" the regular selling price. The remaining gloves were cleared out in the third month at $16.68. The store's
1. What were the total sales?
2. What was the effective rate of markup as a percent of cost?
3. What was the total operating profit or loss on the sale of all of the gloves?
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