During February, Charm Inc. worked on two jobs with the following data: Job 13 Job 12 Units in each job 100 units 200 units Units sold 100 units ---- Materials requisitioned $5,230 $3,970 Direct labor hours 900 hrs. 1,220 hrs. Direct labor cost $13,500 $18,300 Overhead is assigned on the basis of direct labor hours at a rate of $8. During February, Job 12 was completed and transferred to Finished Goods. Job 13 is the only unfinished job at the end of the month. A. Prepare the journal entries for requisitioning all materials used during the month. B. Prepare the journal entries for direct labor for the month. Assume the workers have not been paid yet.
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.
During February, Charm Inc. worked on two jobs with the following data:
| Job 13 | Job 12 | |
| Units in each job | 100 units | 200 units |
| Units sold | 100 units | ---- |
| Materials requisitioned | $5,230 | $3,970 |
| Direct labor hours | 900 hrs. | 1,220 hrs. |
| Direct labor cost | $13,500 | $18,300 |
A. Prepare the
B. Prepare the journal entries for direct labor for the month. Assume the workers have not been paid yet.
(see attachment)
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