Zapato Company produces two types of boots: vaquero and vaquera. There are four activities associated with the two products. Drivers for the four activities are as follows: Vaquero Vaquera Cutting hours 2,130 5,400 Assembly hours 2,850 4,650 Inspection hours 990 2,430 Rework hours 150 450 Required: 1. Calculate the consumption ratios for the four drivers. Round your answers to two decimal places. Activity Driver Vaquero Vaquera Cutting hours Assembly hours Inspection hours Rework hours 2. Is there evidence of product diversity? Explain.
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.
Consumption Ratios
Zapato Company produces two types of boots: vaquero and vaquera. There are four activities associated with the two products. Drivers for the four activities are as follows:
| Vaquero | Vaquera | |||
| Cutting hours | 2,130 | 5,400 | ||
| Assembly hours | 2,850 | 4,650 | ||
| Inspection hours | 990 | 2,430 | ||
| Rework hours | 150 | 450 |
Required:
1. Calculate the consumption ratios for the four drivers. Round your answers to two decimal places.
| Activity Driver | Vaquero | Vaquera | |||||
| Cutting hours | |||||||
| Assembly hours | |||||||
| Inspection hours | |||||||
| Rework hours |
2. Is there evidence of product diversity? Explain.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
