Present entries to record the following summarized operations related to production for a company using a job order cost system on December 31. Refer to the Chart of Accounts for exact wording of account titles. (a) Materials purchased on account $176,000 (b) Prepaid expenses incurred on account 12,200 (c) Materials requisitioned: For production orders 153,700 For general factory use 2,700 (d) Factory labor used: On production orders 141,300 For general factory purposes 12,000 (e) Depreciation on factory equipment 37,000 (f) Expiration of prepaid expenses, chargeable to factory 6,100 (g) Factory overhead costs incurred on account 76,000 (h) Factory overhead applied, based on machine hours 105,300 (i) Jobs finished 415,300 (j) Jobs shipped to customers: Cost 412,000 Selling price (assume all sold on account) 638,000 Chart of Accounts General Ledger ASSETS 110 Cash 121 Accounts Receivable 131 Materials 133 Work in Process 135 Factory Overhead 137 Finished Goods 141 Supplies 142 Prepaid Expenses 181 Land 190 Factory Equipment 191 Accumulated Depreciation-Factory Equipment LIABILITIES 210 Accounts Payable 221 Utilities Payable 251 Wages Payable EQUITY 311 Common Stock 340 Retained Earnings 351 Dividends 390 Income Summary
Present entries to record the following summarized operations related to production for a company using a job order cost system on December 31. Refer to the Chart of Accounts for exact wording of account titles. (a) Materials purchased on account $176,000 (b) Prepaid expenses incurred on account 12,200 (c) Materials requisitioned: For production orders 153,700 For general factory use 2,700 (d) Factory labor used: On production orders 141,300 For general factory purposes 12,000 (e) Depreciation on factory equipment 37,000 (f) Expiration of prepaid expenses, chargeable to factory 6,100 (g) Factory overhead costs incurred on account 76,000 (h) Factory overhead applied, based on machine hours 105,300 (i) Jobs finished 415,300 (j) Jobs shipped to customers: Cost 412,000 Selling price (assume all sold on account) 638,000 Chart of Accounts General Ledger ASSETS 110 Cash 121 Accounts Receivable 131 Materials 133 Work in Process 135 Factory Overhead 137 Finished Goods 141 Supplies 142 Prepaid Expenses 181 Land 190 Factory Equipment 191 Accumulated Depreciation-Factory Equipment LIABILITIES 210 Accounts Payable 221 Utilities Payable 251 Wages Payable EQUITY 311 Common Stock 340 Retained Earnings 351 Dividends 390 Income Summary
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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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Present entries to record the following summarized operations related to production for a company using a job order cost system on December 31. Refer to the Chart of Accounts for exact wording of account titles.
| (a) | Materials purchased on account | $176,000 |
| (b) | Prepaid expenses incurred on account | 12,200 |
| (c) | Materials requisitioned: | |
| For production orders | 153,700 | |
| For general factory use | 2,700 | |
| (d) | Factory labor used: | |
| On production orders | 141,300 | |
| For general factory purposes | 12,000 | |
| (e) | 37,000 | |
| (f) | Expiration of prepaid expenses, chargeable to factory | 6,100 |
| (g) | 76,000 | |
| (h) | Factory overhead applied, based on machine hours | 105,300 |
| (i) | Jobs finished | 415,300 |
| (j) | Jobs shipped to customers: Cost | 412,000 |
| Selling price (assume all sold on account) | 638,000 |
Chart of Accounts
| General Ledger | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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