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Different Accountants have different methods based upon the level of accurate job cost detail desired. We determine the number of products under construction during the chosen time period (typically a month), how many active and inactive weeks each product spent in production and allocated indirect costs accordingly.
In this case it is houses under construction. Active construction weeks get charged for both overhead and payroll costs and inactive (field work on hold) only overhead. Overhead and indirect payroll costs are determined for the month and applied to the jobs accordingly.
What else can I help you with?
Limitations of cost accounting?
Some limitations of cost accounting include: Not capturing all intangible costs and benefits, such as employee morale or brand reputation. Tendency to focus on historical data rather than future-oriented analysis. Can be complex and time-consuming to implement accurately, leading to potential errors or biases in the information provided.
What are the advantages of the weighted average method?
The weighted average method is advantageous because it smoothens out fluctuations in inventory costs by incorporating both old and new cost data. It is simple to calculate and less subject to distortions from extreme price changes. This method is also compliant with generally accepted accounting principles (GAAP).
Is interest a fixed cost?
No, interest is considered a variable cost because it can change based on the amount borrowed, the interest rate, and the length of time the funds are borrowed for. Fixed costs, on the other hand, remain constant regardless of the level of production or sales.
What are the objectives of wage and salary administration in business firm?
The objectives of wage and salary administration in a business firm are to ensure fair compensation for employees based on their skills and experience, to attract and retain talent, to motivate employees to perform at their best, and to maintain cost control and competitiveness in the market.
Law of decreasing opportunity cost?
Opportunity cost does not decrease, it increases, according to the law of increasing opportunity costs. This law states that the more of a product you produce the less efficient production of it will be and the more opportunity cost they will incur.
What percentage of donations to UNICEF goes towards program services, and how much is allocated to cover UNICEF administrative costs?
Approximately 88 of donations to UNICEF goes towards program services, while around 12 is allocated to cover UNICEF administrative costs.
What are the advantages of excess of loss reinsurance?
- Simplified accounting procedures - Low administrative costs
Which general staff position of the incident command system manages costs related to the incident and provides accounting procurement time recording and cost analyzes?
Finance/Administrative Section Chief.
How would you describe fully absorbed costs?
Fully absorbed costs refer to costs where the firm has allocated fixed manufacturing costs to products produced or divisions within the firm as required by generally accepted accounting principles.
Which General Staff position manages costs related to the incident and provides accounting procurement and cost analyses?
Which General Staff position manages costs related to the incident, and provides accounting, procurement, and cost analyses
What is undistributed cost?
Undistributed cost refers to expenses that cannot be directly allocated to specific products, services, or departments within a business. These costs typically include overhead expenses such as administrative salaries, rent, and utilities that support overall operations but aren't tied to a particular output. As a result, they are often treated as general expenses in financial reporting and management accounting. Understanding undistributed costs is crucial for accurate budgeting, pricing strategies, and profitability analysis.
What is the traditional costing formula?
Traditional costing is a method in accounting where the manufacturing overhead costs are allocated to the products manufactured. It is also called as conventional costing.
What is Red Cross administrative cost?
Red Cross administrative costs refer to the expenses associated with managing and operating the organization, including salaries, utilities, office supplies, and other overhead expenses required to ensure efficient functioning. These costs are typically a portion of the overall budget and are necessary to support the delivery of programs and services. The Red Cross aims to keep administrative costs as low as possible to maximize the funds allocated to humanitarian efforts. Transparency in these costs is important for maintaining donor trust and support.
Examples of non relevant cost?
Examples are Sunk Costs, Fixed costs and Allocated Costs.
How do you calculate the cost per unit?
Vague question. Here's my attempt. Simple cost is an accumulation of input costs. It is important to include all costs. i.e.(time, material, overhead). It can be actual costs or replacement costs. That gets into pricing, accounting, taxation, and banking. I recommend looking in financial accounting and cost accounting to see which fits best. A general rule: Total manufacturing costs/ total produced units
What are Both traced direct costs and allocated indirect costs?
cost assignments
Which general staff position manages costs related?
The general staff position that manages costs related to incidents is the incident commander. Some of the responsibilities include accounting, procurement and cost analysis among others.
