Clear Water Bay Inc. has provided the following data from its activity-based costing system: Activity Cost Pool Total Cost Total Activity Cost driver Assembly $700,000 35,000 machine-hours Processing orders $66,500 1,900 orders Inspection $37,920 1,580 inspection-hours Data concerning the company's product P58Z appear below: Annual unit production 400 Annual machine-hours 1,000 Annual number of orders 200 Annual inspection hours 30 Direct material cost $34.78 per unit Direct labor cost $24.08 per unit According to the activity-based costing system, what is the total cost per unit of product P58Z
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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