Job No. 92 Date Beg. bal. Jan. 1 8 12 25 27 Direct Materials Cost of completed job: Direct materials Direct labor 6,400 7,000 2,500 Manufacturing overhead Total cost Unit cost ($52,300 + 2,000) Overhead rate Direct Labor 7,000 31 10,000 15,900 21,000 4,000 $15,900 21,000 15,400 $52,300 $26.15 Balance in Work in Process Inventory on January 1 $ (a) On the basis of this data, answer the following questions. (1) What was the balance in Work in Process Inventory on January 1 if this was the only unfinished job? Last year For 2,000 Units Manufacturing Overhead Date Account Titles and Explanation Jan. 31 (2) If manufacturing overhead is applied on the basis of direct labor cost, what overhead rate was used in each year? (Round answers to 0 decimal places, e.g. 55%.) (To record raw materials used) 4,900 (To record factory labor used) 7,500 % 3,000 15,400 (b) Prepare summary entries at January 31 to record the current year's transactions pertaining to Job No. 92. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Current year Debit % 11 Credit
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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