Problem (worksheet) 1. Finished goods The books of Rochelle Products Company show the folowing account badances as of March 1: P 78, 830 Work in process 292, 621 Materids 65, 000 Over- or under opplied factory 12, 300 (Cr.) The work in process account is supported by the folowing job order cost sheets: Direct Materials Direct Factory Job Item Labor Overhead Totd 204 80, 000 balloons P 15, 230 P 21, 430 P 13, 800 P 50, 460 55, 240 22, 370 19, 366 205 5, 000 life rafts 40, 450 118, 060 206 10, 000 life belts 60, 875 43, 860 124, 101 P 292, 621 Totd P 16, 555 P 120, 530 55, 536 During March, the folowing transactions occurred: a. Purchase of materials, P 42, 300 b. Purchase of special materids wCas P 5, 800 for new Job 207, which colls for 4, 000 life jackets. c. hcirect Iabor cost was P 12, 480. Direct labor was folows: Job Amount Hours 204 P26, 844 3, 355.5 205 22, 750 3, 250. O 206 28, 920 3,615.O 207 20, 370 2,910.0 d. Materids issued: Job 204 P 9, 480 Job 205 P 1, 320 Job 206 P 1O, 490 Job 207 P 16, 640 (excluding P5, 800 of specid materials, which are dso issued at this time) e. Other factory overhead incurred or accrued: Insurance on factory P 830. 00 Tax on real estate 845. 00 780. 00 Depreciation-machinery Depreciation-factory building Light Cod used 840. 00 560. 00 1, 810. 00 3, 390. 00 Power Repairs and maintenance Indirect supplies 2, 240, 00 1, 910. 00 15, 256. 87 f. Factory overhead is applied at the rate of P 2.30 per direct labor hour. An applied overhead control account is used and is Miscellaneous then closed to the overhead control account. g. Job 204 was shipped and billed at a contract price of P 117, 500. . Required: (1) Compute the total cost of each job at the end of March. (2) Determine the over- or under-qpplied factory overhead remaining in the overhead account. (3) Necessary Journd entries for Job 204
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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