business and how the new equipment will help the business to function and the cost of the product will determine what the managers of the business decides. Marginal costs are change in total costs divided by change in output. Marginal revenue is the change in total revenue divided by change in output. Increase in fixed costs means that when the fixed costs cannot be changed it is the short run and when the fixed costs change it is the long run. The second questions that I chose to answer was
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Cost allocation for indirect costs Cost Pool – Set of costs that are added together before being allocated to cost objects on some common basis Cost Driver/ Allocation base Cost Object Cost Driver Rate = Total Costs in Pool/ Total Quantity of Driver Where total quantity of driver = practical capacity of driver Cost of excess capacity = Cost Driver Rate * Excess capacity Predetermined overhead rate - cost per unit of the allocation base used to charge overhead to products. Predetermined
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THE MANAGEMENT OF OVERHEAD COSTS IN CONSTRUCTION COMPANIES Brian Eksteen1 and David Rosenberg² ¹Professor of Construction Management‚ Faculty of Economic and Building Sciences‚ University of Port Elizabeth‚ P.O. Box 1600‚ Port Elizabeth‚ 6000‚ South Africa ²Senior Lecturer in Cost and Management Accounting‚ Faculty of Economic and Building Sciences‚ University of Port Elizabeth‚ P.O. Box 1600‚ Port Elizabeth‚ 6000‚ South Africa Costs not directly attributable to or recoverable from production
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Cost classification is the process of grouping costs according to their common characteristics. A suitable classification of costs is of vital importance in order to identify the cost with cost centres or cost units. Cost may be classified accounting to their nature‚ i.e.‚ material‚ labor and expenses and a number of other characteristics. The same cost figures are classified according to different ways of costing depending upon the purpose to be achieved and requirements of particular
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from the home to the prisons? The subject of women’s issues has sporadically been discussed in our society‚ and it has just recently being uncovered that women operate differently than men in situations; and those differences are now starting to effect the growth rate in the population of women in prisons. The mission statement of the Federal Bureau of Prisons states that it “…protects society by confining offenders in the controlled environments of prisons and community-based facilities that
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Cost Benefit Analysis A cost benefit analysis is done to determine how well‚ or how poorly‚ a planned action will turn out. Although a cost benefit analysis can be used for almost anything‚ it is most commonly done on financial questions. Since the cost benefit analysis relies on the addition of positive factors and the subtraction of negative ones to determine a net result‚ it is also known as running the numbers. A cost benefit analysis finds‚ quantifies‚ and adds all the positive factors. These
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long-lived assets generally include those expenditures that: 1) are made for normal repairs to maintain the usefulness of the asset over a number of years. 2) are for items that have a physical life of more than a year‚ regardless of their cost. 3) are material and that have an economic benefit to the entity only in the current year. 4) are material and that have an economic benefit to the entity that extends beyond the current year. Question 11 0 / 1 point Cassady‚ Inc.
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manufacturing cost categories. LO2 Distinguish between product costs and period costs and give examples of each. including calculation of the cost of goods sold. LO4 Prepare a schedule of cost of goods manufactured. LO5 Understand the differences between variable costs and fixed costs. LO6 Understand the differences between direct and indirect costs. LO7 Define and give examples of cost classifications used in making decisions: differential costs‚ opportunity costs‚ and sunk costs. LO8
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Describe the schedule of cost goods manufactured. How does it tie into the income statement? 5. Why are product costs sometimes called inventoriable costs? Describe the flow of such costs in a manufacturing company from the point of incurrence until they finally become expenses on the income statement. 6. Is it possible for costs such as salaries or depreciation to end up assets on the balance sheet? Explain. 7. “The variable cost per unit varies with output‚ whereas the fixed cost per unit is constant
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is not sure about the difference between cost accounting and a cost accounting system. Explain the difference to Joe. (b) What is an important feature of a cost accounting system? 2. (a) Distinguish between the two types of cost accounting systems. (b) May a company use both types of cost accounting systems? 3. What type of industry is likely to use a job order cost system? Give some examples. 4. What type of industry is likely to use a process cost system? Give some examples. 5. Your roommate
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