kasembe ltd is considering its plans for the year ending 3i december 2014. it makes and sells a single product, which has budgeted costs and selling price as follows: selling price $45 per unit, direct materials $11 per unit, direct labour $8 per unit. production overhead: variable $4000 per unit, fixed $$3000. Selling overhead: variable $5000, fixed $2000. Adminstration overhead: fixed $3000. fixed overhead costs per unit are based on a normal annual activity level of 96000 units. these costs are expected to be incured at a constant rate throughout the year. activity levels during january and february 2014 are expected to be:january sales 7000 units, production 8500 units; february sales 8750 units, production 7750 units. assume that there will be no stock held on 1 january 2014. required; a) prepare profit statements for each of the two months of january and february using; absorption costing and marginal costing. reconcile and explain the reasons for any differences
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.
kasembe ltd is considering its plans for the year ending 3i december 2014. it makes and sells a single product, which has budgeted costs and selling price as follows: selling price $45 per unit, direct materials $11 per unit, direct labour $8 per unit. production
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