Bryt Morning Ltd provides the service of F&B equipment repairs to hotels and restaurants. On 1 Jan 2021 there was one uncompleted job in the workshop/ factory The job card details are as follows: Job card no: 632 Cost to date: $ Direct Materials 725 Direct Labour ( 140 Hrs) 360 Factory overhead ( $2 / direct labour hr) 280 Total 1365 During January, 3 new jobs were started and cost of production were as follows: Direct Materials: Issued to: $ Job 632 2280 Job 633 1750 Job 634 4380 Job 635 4575 Damaged inventory written off in Stores 1300 Materials transfer: From Job 634 to Job 633 350 From Job 632 to Job 634 820 Materials returned to Store: From Job 632 870 From Job 635 380 Direct labour recorded: Job 632 430 hrs Job 633 600 hrs Job 634 380 hrs Job 635 510 hrs Cost of labour during January 2021 was $ 3.25 / hr Production overhead is absorbed at the rate of $2 per direct labour hr Completed jobs were delivered and invoiced as soon as completed with details as follows: Invoiced amount - $ Job 632 8,300 Job 634 7,900 Job 635 8,750 Administration and marketing overheads are absorbed to arrive at the cost of sales at the rate of 18% of factory cost. Required: a) Prepare job accounts for individual jobs b) Prepare summarised job cost cards for each job and calculate profit on each completed job
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.
Bryt Morning Ltd provides the service of F&B equipment repairs to hotels and restaurants.
On 1 Jan 2021 there was one uncompleted job in the workshop/ factory
The job card details are as follows:
Job card no: 632
Cost to date: $
Direct Materials 725
Direct Labour ( 140 Hrs) 360
Factory overhead ( $2 / direct labour hr) 280
Total 1365
During January, 3 new jobs were started and cost of production were as follows:
Direct Materials:
Issued to: $
Job 632 2280
Job 633 1750
Job 634 4380
Job 635 4575
Damaged inventory written off in Stores 1300
Materials transfer:
From Job 634 to Job 633 350
From Job 632 to Job 634 820
Materials returned to Store:
From Job 632 870
From Job 635 380
Direct labour recorded:
Job 632 430 hrs
Job 633 600 hrs
Job 634 380 hrs
Job 635 510 hrs
Cost of labour during January 2021 was $ 3.25 / hr
Production overhead is absorbed at the rate of $2 per direct labour hr
Completed jobs were delivered and invoiced as soon as completed with details as follows:
Invoiced amount - $
Job 632 8,300
Job 634 7,900
Job 635 8,750
Administration and marketing
Required:
a) Prepare job accounts for individual jobs
b) Prepare summarised
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