Required information [The following information applies to the questions displayed below.] The following information is available for ADT Company, which produces special-order security products and uses a job order costing system. Overhead is applied using a predetermined overhead rate of 55% of direct labor cost. Inventories Raw materials Work in process Finished goods Beginning of period $ 40,000 9,200 56,000 Cost incurred for the period Raw materials purchases Factory payroll Factory overhead (actual) Indirect materials used Indirect labor used Other overhead costs End of Period $ 48,000 18, 200 34,900 $ 182,000 250,000 14,000 57,500 108,000 1. Direct labor used (recorded as factory wages payable). 2. Indirect labor used (recorded as factory wages payable). Prepare journal entries for the above transactions for the period.
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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![Required information
[The following information applies to the questions displayed below.]
The following information is available for ADT Company, which produces special-order security
products and uses a job order costing system. Overhead is applied using a predetermined overhead
rate of 55% of direct labor cost.
Inventories
Raw materials
Work in process
Finished goods
Beginning of
period
$ 40,000
9,200
56,000
Cost incurred for the period
Raw materials purchases
Factory payroll
Factory overhead (actual)
Indirect materials used i
Indirect labor used
Other overhead costs
End of
Period
$ 48,000
18, 200
34,900
$ 182,000
250,000
14,000
57,500
108,000
1. Direct labor used (recorded as factory wages payable).
2. Indirect labor used (recorded as factory wages payable).
Prepare journal entries for the above transactions for the period.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7810ab07-6748-4d32-b0d1-a5d0d459c5f8%2F32e9947e-8204-472c-ac47-39daf99b736e%2Fr5dqr6f_processed.jpeg&w=3840&q=75)
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