Assume the following information relates to the Bossing Corporation for the month of September Job No. 101 Job No. 102 Job No. 103 In process, July 1 Materials P 40,000 P 30,000 - Labor 60,000 40,000 - Overhead 75,000 50,000 Cost added in July Materials 55,000 80,000 92,000 Labor 80,000 95,000 115,000 Job No. 101 and 102 were completed and transferred to finished goods warehouse in September. Actual overhead incurred in September amounted to P 375,000. Overhead is applied using a predetermined overhead rate. Job 101 was sold for P 550,000. Requirements: Compute for the following: Work in process, September 1 Overhead assigned to production in September assuming same factory OH rate Cost of goods manufactured Cost of goods sold (actual) Finished goods inventory, September 31 Work in process inventory, September 31
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Assume the following information relates to the Bossing Corporation for the month of September
|
|
Job No. 101 |
Job No. 102 |
Job No. 103 |
|
In process, July 1 |
|
|
|
|
Materials |
P 40,000 |
P 30,000 |
- |
|
Labor |
60,000 |
40,000 |
- |
|
Overhead |
75,000 |
50,000 |
|
|
Cost added in July |
|
|
|
|
Materials |
55,000 |
80,000 |
92,000 |
|
Labor |
80,000 |
95,000 |
115,000 |
Job No. 101 and 102 were completed and transferred to finished goods warehouse in September. Actual overhead incurred in September amounted to P 375,000. Overhead is applied using a predetermined overhead rate. Job 101 was sold for P 550,000.
Requirements: Compute for the following:
- Work in process, September 1
- Overhead assigned to production in September assuming same factory OH rate
- Cost of goods
manufactured - Cost of goods sold (actual)
- Finished goods inventory, September 31
- Work in process inventory, September 31
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