Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Activity Based Costing or ABC
Absorption costing shows to be relatively straightforward way of adding overhead costs to units of production utilizing, more often than not, a volume-related absorption basis as like direct machine hours or direct labour hours. The assumption such all overheads are related primarily to production volume is implied in such system. Absorption costing was developed at a time while most organizations produced merely a narrow range of products and while overhead costs were only an extremely small fraction of net costs, direct material and direct labour costs accounting for the largest proportion of the costs. Therefore errors made in adding overheads to products were not extremely important.
However nowadays, along with the advent of advanced manufacturing technology, overheads are likely to be far more significant and in fact direct labour may account for as little 5 percent of a product's cost. Furthermore, there has been a raise in the costs of non-volume related support activities, such as setting-up, production scheduling, inspection and data processing that assist the efficient manufacture of a wide range of products. In general these overheads are not, affected via changes in production volume. They tend to vary in the long term according to the range and complexity of products manufactured quite than the volume of output.
Since traditional absorption costing methods tend to allocate extremely a great proportion of overheads to high-volume products that cause relatively little diversity, and also too small a proportion of overheads to low-volume products that cause greater diversity and hence employ more support services, other methods of costing have been developed. Activity-based costing or ABC is one such development.
The state legislature has voted to develop a grant-in-aid policy to try and induce local communities to devote more resources to improving their infrastructure. Town O = Has a
You are provided with the subsequent information relating to Cello Ltd. The accountant is currently preparing the budget for the next three months ending 30 June 2010.
Compute the predetermined overhead rate used during the year in the Preparation and Fabrication Departments.
Vintage Auto Company manufactures parts to order for antique cars. Vintage Auto makes everything from fenders to engine blocks. Each customer order is treated as a job. Vintage Aut
. Alice Company has received a special order from John. John wishes to buy 100 units of Alice's product at a price of $48. The regular price is $65. The unit cost informati
Introduction of Internal Rate of Return The traditional internal rate of return (IRR) method of project selection has been shown to be inferior to the NPV method due to vario
Cost Volume Profit Analysis 1. Post Publishers has collected the following data for recent months: Month Issues published Total cost May
Q. Explain Break-even revenue? Sales revenue earned would give no profit and no loss. It can be computed by multiplying break-even volume (above) by products selling price, or
Contract Accounts It is a separate account such is maintained and opened for every contract undertaken for the reasons of accumulating cots. Every contract is given a number
Beginning inventory on March 1 consisted of 2,000 units each costing $11.20 . During March, the following was purchased for inventory: Date Purchase
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd