Lavender Enterprise is a recently opened cake shop in Subang Jaya, which just started this year.

The shop specializes in custom-made cakes for birthdays, weddings, and special occasions such

as communion, anniversaries, and graduations. Due to their impressive talent for crafting

innovative cake designs and flavours, the store gained a small level of notoriety for a brief

period of time, and as a result, they have a vast base of clients that originate from all over the

world. Page 3 of 10

The following is the information that resulted from producing the personalised cakes that were

requested (order no. 182) by the boss's customer in 2020:

Direct Material

RM 120

Direct Labour:

- Designing

- Baking

- Decorating

1 hours

2 hours

8 hours

RM 40 per hour

RM 50 per hour

RM 30 per hour

Overhead

- Design

- Baking

- Decorating

RM 35

RM 65

RM 55

The company also incurred the following costs:

1) Administrative overhead is at 8% of factory cost.

2) Selling and distribution overhead is 15% more than administrative overhead.

Additional information:

1) Special machines were hired during the production process at RM 230.

2) Profit was estimated at 45% of selling price.

Based on the information given,

DESCRIBE the cause of Lavender Enterprise using Job Costing Method instead of

Process Costing Method.