ACTG 2020 Lecture Notes - Lecture 3: Core Competency, Casebook
Document Summary
Produce wide variety of products and services that are distinct from each other. Unit costs is computed by dividing total job costs by units produced for that job. Product costs are per job, not per product. Costs are accumulated by department or process. Unit cost computed by dividing process costs for the period by the units produced in the period. Job order costing system -costs are collected and assigned to units of production for each job. Trace dm and dl costs to each job, and allocate over heads to each job. Unit cost in the job-order system is sum of dm dl and overhead, for that job. Cost accumulation system: actual: actual costs incurred to make the product, normal: actual materials, labour, but overhead is applied using predetermined rate. Overhead must be estimated and applied to output: standard: come up with a standard for all costs (costs are usually generalized. Mass produce large quantities of similar or homogenous products.
