Cost Accounting

Case Study You are a recent employee at Garland Manufacturing and your supervisor asked you to prepare a quotation for an upcoming project. The following are the estimated costs for the project. The Job is recorded as \#101. 60 units of direct material each costing $2400 will be required for the job. Four men will be required to work for eight weeks at 40 hours per week. The men are to be paid $500 per hour. The company plans to hire a special machine for 48 hours at $4200 per hour. A consultant will be hired for 30 hours at a rate of $2 500 per hour; this is to be treated as direct labour hours. The company will recover overhead expenses on the basis of direct labour hours at a rate of $650 per hour. General and administrations costs will be 20% of total production costs. Profit is calculated at 25% markup which is to be added to the cost computed for the job. Required: A. Calculate the total cost for Job \#101 showing the quoted selling price. B. Identify THREE (3) characteristics of a job costing system. c. Distinguish between job and batch costing citing ONE (1). relevant example of EACH. Lakers Ltd is considering three projects and has decided to apply ABC analysis to estimate the costs of the projects. Additional information relating to the prospective projects is as follows. The following information was obtained from the company. Required: A. Calculate the cost driver rates for each activity. . Calculate the total cost of each project using the ABC approach. c. Differentiate between Activity Based Costing and Traditional Costing. A company makes a product that passes through two production processes. For the week ended December 31 , 2012, details of production were as follows