Q2 Oman Chromite manufacturing uses a job order cost accounting system. On May 1, the company has a balance in Work in Process Inventory of $ 12,800 and two jobs in process: Job No. 439, $ 8000 and Job No. 440, $ 4,800. During May, a summary of source documents reveals the following. Job Number Materials Requisition Slips Labor Time Tickets 439 $10,000 $7,600 440 14,000 12,000 441 17,600 $41,600 30,400 $50,000 General use 3,200 4,800 $44,800 $54,800 Oman Chromite manufacturing applies manufacturing overhead to jobs at an overhead rate of 90% of direct labor cost. Job No. 439 is completed during the month. Instructions (a) Prepare summary journal entries on May 31 to record: (i) the requisition slips, (ii) the time tickets, (iii) the assignment of manufacturing overhead to jobs, and (iv) the completion of Job No. 439. (b) Post the entries to Work-in –Process Inventory account
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.
Q2
Oman Chromite manufacturing uses a
During May, a summary of source documents reveals the following.
|
Job Number |
Materials Requisition Slips |
Labor Time Tickets |
||
|
439 |
$10,000 |
|
$7,600 |
|
|
440 |
14,000 |
|
12,000 |
|
|
441 |
17,600 |
$41,600 |
30,400 |
$50,000 |
|
General use |
|
3,200 |
|
4,800 |
|
|
|
$44,800 |
|
$54,800 |
Oman Chromite manufacturing applies manufacturing
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