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A costing system that traces direct costs to a cost object by using the actual direct-cost rates times the actual quantities of the direct-cost inputs and that allocates indirect costs based on the budgeted indirect-cost rates times the actual quantities of the cost-allocation bases.
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How does an actual costing system different from a normal costing system?
Well, imagine an actual costing system as painting a landscape exactly as it is in front of you, capturing every detail and color with precision. On the other hand, a normal costing system is like painting a landscape from memory, using average costs and estimates to create a general picture. Both methods have their own beauty and usefulness, depending on the situation. Just remember, there's no mistakes in art, only happy little accidents.
Why might a consulting firm use noraml costing system rather than actual costing system?
A consulting firm might use a normal costing system instead of an actual costing system primarily for ease of budgeting and forecasting. Normal costing allows the firm to apply overhead costs based on a predetermined rate, which simplifies the allocation process and provides more timely financial information. This approach also helps in managing cash flow and maintaining consistent pricing strategies, as actual costs can fluctuate significantly based on project demands. Additionally, normal costing can facilitate performance evaluation by providing a stable basis for comparing projected versus actual results.
Why do you need product costing system?
needs of product costing system
What is another name for absorption costing?
Full costing system
What is a responsibility costing system?
responsibility costing is a costing which enable us to know which department is responsible for what
How does an actual costing system different from a normal costing system?
Well, imagine an actual costing system as painting a landscape exactly as it is in front of you, capturing every detail and color with precision. On the other hand, a normal costing system is like painting a landscape from memory, using average costs and estimates to create a general picture. Both methods have their own beauty and usefulness, depending on the situation. Just remember, there's no mistakes in art, only happy little accidents.
Why might a consulting firm use noraml costing system rather than actual costing system?
A consulting firm might use a normal costing system instead of an actual costing system primarily for ease of budgeting and forecasting. Normal costing allows the firm to apply overhead costs based on a predetermined rate, which simplifies the allocation process and provides more timely financial information. This approach also helps in managing cash flow and maintaining consistent pricing strategies, as actual costs can fluctuate significantly based on project demands. Additionally, normal costing can facilitate performance evaluation by providing a stable basis for comparing projected versus actual results.
Why do you need product costing system?
needs of product costing system
If you were a candy manufacturer which costing system should you use full absorption costing or variable costing?
full absorption costing
What is another name for absorption costing?
Full costing system
What is a responsibility costing system?
responsibility costing is a costing which enable us to know which department is responsible for what
What are the main features of standard costing system?
features of standard costing
When is a job order costing system more appropriate than a process costing system?
Job order costing is more appropriate than process costing when the product being produced is a custom product
When job order costing system would be more appropriate than process costing system?
A job order costing system would be more appropriate than a process costing system for manufacturers who use different types of goods throughout the manufacturing process. Process costing is best to you when manufacturing a large amount of the same items.
What are the benefit's and limitations of job order costing and process costing system?
to undersrand
Which is the best costing system for Automobile Industry?
process costin and target costing
What are the differences between activity-based absorption costing system and traditional absorption costing system?
An activity-based absorption costing system defines the cost by how many activities a product unit uses. A traditional absorption costing system defines the cost by how much money went into making the product unit.
