As part of a cost study, the cost accountant of Shiny Corporation has recorded the cost of operations at seven different levels of materials usage. The records show the following: 80 kilos - P800 60 kilos - P480 20 kilos - P320 120 kilos - P1,200 140 kilos - P1,280 40 kilos - P480 100 kilos - P1,040 Sum of the kilos (Σx) - P560 Sum of the costs (Σy) - P5,600 Sum of the kilos multiplied by the costs (Σxy) - P545,600 Sum of the kilos squared (Σx2) - P56,000 1.) The projected cost of operations for 90 kilos of materials is: a. P880.00 regardless of the method used. b. P886.90 if the method of least squares is used. c. P886.90 if the high-low points method is used. d. P880.00 if the method of least squares is used. 2.) Using the high-low points method, the variable cost of operations per kilo of materials used is: a. P8.00 b. P16 c. P9.14 d. P10 3.) Using the least squares method, the fixed portion of the cost is: a. P103 b. P320 c. P160 d. P206
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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