Costing Methodologies Flashcards
1
Q
When do you use job order costing?
A
used to determine the cost of manufacturing each product. Includes direct materials, labor, and overhead for a particular job.
i.e. building a custom home
2
Q
How is overhead allocated in a ABC system
A
activity rate x number of cost driving events
3
Q
Cost Driver
A
the amount of a cost associated with a particular costing activity
4
Q
How do we treat production cost in a process costing system
A
total production cost / number of units completed
