Georgia Co.'s tool division, Ash, incurred the following costs for year 2: Variable Fixed Direct materials Direct labor Factory overhead General, administrative selling. and Php 240,000 180,000 84,000 36,000 Php 50,400 57,600 Total Php 540,000 Php 108,000 During year 2, Ash produced 360,000 hammers, which were sold for Php 2.40 each. Georgia's investment in Ash was Php 600.000 and Php 840,000 at January 1, year 1 and January 1, year 2, respectively. Georgia normally imputes interest on investments at 18% of average invested capital. 7. For the year ended December 31, year 2, Ash's return on average investment was 8. Assume that Ash's net operating income was Php 72.000 and its average invested capital was Php 720,000. Determine Ash's residual income (loss) for the year ended December 31, year 2. 9. Ash's contribution margin for the year ended December 31, year 2 was
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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