ADM 2304 Lecture Notes - Lecture 8: Scott Paper Company, Systems Design, Cost Driver
13 May 2017
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Comparing process and job-order costing: e. g, which of the following companies would be likely to use job-order costing rather than process costing: scott paper company for kleenex. b. Architects. c. heinz for ketchup: caterer for a wedding reception. e. builder of commercial shing vessels. > charge direct material and direct labour costs to each job as work is performed. predetermined overhead rate (pohr) used to apply overhead to jobs is determined before the period begins. Overhead applied = pohr ( based on estimates, and determined before the period begins. Actual activity (l amount of the allocation based upon the actual level of activity) e. g, pohr = ,000 / 160,000 direct labour hours (dlh) > for each direct labour hour worked on a particular job, . 00 of factory overhead will be applied to that job. Choice of an allocation base for overhead cost. > the allocation base used in the pohr should drive the overhead cost.
