Computing job costs and overhead rate; assigning costs to inventory C1 P3 At the end of May, the job cost sheets at Cool Pool show the following costs accumulated on three jobs. At May 31 Direct materials...... Direct labor......... Overhead applied.... Job 8 $25,000 10,000 6,000 Job 9 $23,240 8,600 5,160 Required 1. What is the total cost of direct materials requisitioned in May? 2. What is the total cost of direct labor used in May? 3. What is the predetermined overhead rate? 4. What is the total cost transferred to Finished Goods Inventory in May? Job 10 $26,800 9,500 5,700 Additional information a. Job 8 was started in April, and the following costs were assigned to it in April: direct materials, $8,000; direct labor, $2,000; and applied overhead, $1,200. Job 8 was finished in May. b. Job 9 and Job 10 were started in May; Job 9 was finished in May, and Job 10 is to be completed in June. c. Overhead cost is applied with a predetermined rate based on direct labor cost. The predetermined overhead rate did not change across these months. 1)
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.
Looking to get assistance solving the required steps for Problem 19-1B. Any help is appreciated!
Note: As per our guidelines, we will solve the first three subparts.
1.
| Direct Materials | |
| Job 8 ($25,000-$8,000) | $17,000 |
| Job 9 | $23,240 |
| Job 10 | $26,800 |
| Total cost of direct material requisition | $67,040 |
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