Jacks Company uses a job order costing system and the following information is available from its records. The company has three jobs in process: #1, #2, and #3. Raw material used P120,000 Direct labor per hour P8.50 Overhead applied based on direct labor cost 120% Direct material was requisitioned as follows for each job respectively: 30 percent, 25 percent, and 25 percent; the balance of the requisitions was considered indirect. Direct labor hours per job are 2,500; 3,100; and 4,200; respectively. Indirect labor is P33,000. Other actual overhead costs totaled P36,000. Assume the balance in Work in Process Inventory was P18,500 on June 1 and P25,297 on June 30. The balance on June 30 represents one job that contains direct material of P11,250. How many direct labor hours have been worked on this job (rounded to the nearest hour)?
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.
Jacks Company uses a
available from its records. The company has three jobs in process: #1, #2, and #3.
Raw material used P120,000
Direct labor per hour P8.50
Direct material was requisitioned as follows for each job respectively: 30 percent, 25 percent,
and 25 percent; the balance of the requisitions was considered indirect. Direct labor hours per job
are 2,500; 3,100; and 4,200; respectively. Indirect labor is P33,000. Other actual overhead costs
totaled P36,000.
Assume the balance in Work in Process Inventory was P18,500 on June 1 and P25,297 on
June 30. The balance on June 30 represents one job that contains direct material of P11,250.
How many direct labor hours have been worked on this job (rounded to the nearest hour)?
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