information on Kwon Manufacturing's activities 18 a. Purchased $101,000 of raw materials on credit. b. Materials requisitions show the following materials used for the month. Job 201 Job 202 Total direct materials Indirect materials Total materials used $ 49,200 24,600 73,800 9,620 $ 83,420 c. Time tickets show the following labor used for the month. Job 201 Job 202 Total direct labor Indirect labor Total labor used $ 40,200 13,600 53,800 25,200 $ 79,000 d. Applied overhead to Job 201 and to Job 202 using a predetermined overhead rate of 80% of direct materials cost. e. Transferred Job 201 to Finished Goods Inventory. f. Sold Job 201 for $166,760 on credit. g. Incurred the following actual other overhead costs for the month. Depreciation of factory equipment $ 33,000 Rent on factory building (payable) Factory utilities (payable) Expired factory insurance Total other factory overhead costs. 600 900 4,000 $ 38,500 1. Prepare a job cost sheet for Job 201 and for Job 202 for the month. 2. Compute gross profit on the sale of Job 201.
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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Information on Kwon Manufacturing's activities for its first month of operations follows:
a. Purchased $101,000 of raw materials on credit.
b. Materials requisitions show the following materials used for the month.
Job 201
Job 202
Total direct materials
Indirect materials
Total materials used
$ 49,200
24,600
73,800
9,620
$83,420
c. Time tickets show the following labor used for the month.
Job 201
$ 40,200
Job 202
Total direct labor
13,600
53,800
25,200
Indirect labor
Total labor used
$ 79,000
d. Applied overhead to Job 201 and to Job 202 using a predetermined overhead rate of 80% of direct materials cost.
e. Transferred Job 201 to Finished Goods Inventory.
f. Sold Job 201 for $166,760 on credit.
g. Incurred the following actual other overhead costs for the month.
Depreciation of factory equipment
$ 33,000
Rent on factory building (payable)
Factory utilities (payable)
Expired factory insurance
Total other factory overhead costs
600
900
4,000
$ 38,500
1. Prepare a job cost sheet for Job 201 and for Job 202 for the month.
2. Compute gross profit on the sale of Job 201.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5c84d2ca-67e5-464e-bee2-f605a90e9961%2F405edf94-1c0c-4dc4-ad53-81f6a46ca0dc%2Fv7nzeyc_processed.jpeg&w=3840&q=75)
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