During March, Estes Company worked on three jobs. Data relating to these three jobs follow: Job 86 Job 87 Job 88 170 310 180 180 $1,062 198 $3,168 Units in each order Units sold Materials requisitioned Direct labor hours Direct labor cost $1,224 187 $3,410 496 $2,244 $4,464 Overhead is assigned on the basis of direct labor hours at a rate of $7.00 per direct labor hour. During March, Jobs 86 and 87 were completed and transferred to Finished Goods Inventory. Job 87 was sold by the end of the month. Job 88 was the only unfinished job at the end of month. Required: 1. Calculate the per-unit cost of Jobs 86 and 87. Round your answers to the nearest cent. Job 86 Job 87 per unit 2. Compute the ending balance in the work-in-process inventory account. Round your answer to the nearest cent. Sale of Job 87 (cost) per unit 3. Prepare the journal entries reflecting the completion of Jobs 86 and 87 and the sale of Job 87. The selling price is 140 percent of cost. Round your answers to the nearest cent. Completion of Jobs 86 & 87 Sale of Job 87 (sale) 000
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.
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