Oak Creek Furniture Factory (OCFF), a custom furniture manufacturer, uses job order costing to track the cost of each customer order. On March 1, OCFF had two jobs in process with the following costs: Work in Process Job 33 Job 34 Balance on 3/1 $5,500 3,100 $ 8,600 Source documents revealed the following during March: Materials Requisitions Forms $ 3,700 2,400 3,100 1,100 $ 10,300 Job 33 Job 34 Job 35 Indirect Labor Time Tickets $ 4,300 4,500 2,700 1,300 $ 12,800 Status of Job at Month-End Completed and sold Completed, but not sold In process The company applies overhead to products at a rate of 70 percent of direct labor cost. Required: Prepare journal entries to record the materials requisitions, labor costs, and applied overhead. Note: If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.
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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