ACC 406 Lecture Notes - Lecture 2: Carbon-13 Nuclear Magnetic Resonance, Finished Good, European Cooperation In Science And Technology
16 Oct 2017
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Acc406 chapter 5: job order costing: manufacturing firms use unit costs for, valuing inventory, determining income, making imp. Decisions: service firms use unit costs for, profitability, feasibility (conveniently) introducing new services. Process costing: firms use job order acc. Job order costing: production costs, firms use process-costing acc. Problem with actual costing: many overhead costs are not incurred through the year and uneven production levels increase the overhead costs. Beginning of year, company estimated these costs: oh=360000 and dl = 720000. Company uses normal costing and applies overhead on the basis of dl cost. With the actual costing, the rate cannot be known until all costs are known which is basically after acc. Period (step 2) calculate overhead applied to production in feb: applied overhead = predetermined overhead rate x actual activity lvl, = 50 % x 56000, overhead applied to feb production = 28000. Example reconciling applied oh with actual oh (basically 3rd step of the 3 step process)
