Feta Corporation is considering the addition of a new product line. The expected annual revenue and cost data for the new product line are as follows: Unit sales Selling price Variable manufacturing costs Variable selling & administrative expenses Increase in fixed manufacturing costs Increase in fixed selling & administrative expenses O $225 per unit O $250 per unit O $275 per unit O$300 per unit 2,500 units $304 per unit $126 per unit $49 per unit If Feta adds the new product line, the contribution margin on its existing products is expected to drop $62,500 per year. What is the minimum per-unit selling price that Feta must charge to break even on the production and sale of the new product line? None of the above $50,000 $75,000
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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