Moon Bright Sdn. Bhd. is a manufacturer of dish cleaners. The following figures show the cost per unit of production based upon an annual production and sales of 20,000 units: RM Direct materials 80 Direct labour (variable) 40 Variable overhead 20 Fixed overhead 15 Selling price 200 1) Calculate the breakeven point, in units and in value 2) Determine the margin of safety in units and in value 3) Calculate the profit-volume ratio and indicate what it means. 4) Given that there is a sudden extra fixed cost of RM25,000, how many extra units does the company need to sell?
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.
Moon Bright Sdn. Bhd. is a manufacturer of dish cleaners. The following figures show the cost per unit of production based upon an annual production and sales of 20,000 units:
RM
Direct materials 80
Direct labour (variable) 40
Variable overhead 20
Fixed overhead 15
Selling price 200
1) Calculate the breakeven point, in units and in value
2) Determine the margin of safety in units and in value
3) Calculate the profit-volume ratio and indicate what it means.
4) Given that there is a sudden extra fixed cost of RM25,000, how many extra units does the company need to sell?
Trending now
This is a popular solution!
Step by step
Solved in 5 steps
