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  • Total Actual Cost Using Actual Costing System Actual Cost Actual Direct Cost + Actual Overhead Cost

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    Mark Lana
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    The document discusses two costing systems - actual costing and normal costing - for a merchandising company. Under actual costing, the total actual cost is P437,000, which is the sum of actual direct costs, actual overhead costs, and manufacturing overhead. Under normal costing, the predetermined overhead rate is P70 per direct labor hour based on the budgeted manufacturing overhead and production activity. Using this rate, the normal cost is calculated to be P12,600,000.

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    The document discusses two costing systems - actual costing and normal costing - for a merchandising company. Under actual costing, the total actual cost is P437,000, which is the sum of actual direct costs, actual overhead costs, and manufacturing overhead. Under normal costing, the predetermined overhead rate is P70 per direct labor hour based on the budgeted manufacturing overhead and production activity. Using this rate, the normal cost is calculated to be P12,600,000.

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    24 views1 page

    Total Actual Cost Using Actual Costing System Actual Cost Actual Direct Cost + Actual Overhead Cost

    Uploaded by

    Mark Lana
    The document discusses two costing systems - actual costing and normal costing - for a merchandising company. Under actual costing, the total actual cost is P437,000, which is the sum of actual direct costs, actual overhead costs, and manufacturing overhead. Under normal costing, the predetermined overhead rate is P70 per direct labor hour based on the budgeted manufacturing overhead and production activity. Using this rate, the normal cost is calculated to be P12,600,000.

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    LANA, CHABELITA A.

    ONLINE ACTIVITY
    02
    BSBA-2A COSTING AND PRICING

    LEAVELAND MERCHANDISING

    1. TOTAL ACTUAL COST USING ACTUAL COSTING SYSTEM

    Actual Cost = Actual Direct Cost + Actual Overhead Cost

    = (240,000 + 162,000) + 35,000

    = 402,000 + 35,000

    =P437,000

    2. NORMAL COSTING SYSTEM


    A. Predetermined Overhead Rate

    budgeted manufacturing overhead


    Predetermined overhead rate =
    Budgeted Production Activity
    P 3,000,000(180,000 x 30)
    =
    120,000 DHL

    P 3,000,000+ P 5,400,000
    = 120,000 DHL

    P 8,400,000
    = 120,000 DHL

    = P 70 per DHL
    B. Normal Cost
    Normal Cost = Predetermined Overhead rate x Budgeted Production Activity

    = 70 x 180,000

    Normal Cost = P12,600,000

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