Using the reciprocal method, the applied factory overhead of the assembly department if it used 24,700 machine hours is closest to: Galinganmo Corp has two service departments and two producing departments. The following are data available for the year 2021: FOH cost Estimated Area Labor Hrs Occupied 1,200 1,500 2,900 1,100 2,000 1,600 Maintenance P129,000 105,000 Security Cutting Assembly 416,000 1,900 380,000 3,200 The maintenance costs are allocated based on estimated labor hours and security is allocated based on space occupied. The producing department uses machine hours with 50,000 for cutting and 25,000 for assembly to determine the factory overhead rate. P498,693 P259,350 P502,645 P497,211 None of the above
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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