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 $ 27,000 9,500 60,000 Coat incurred for the period Raw materials purchases Factory payroli Factory overhead (actual) Indirect materials used Indirect labor used Other overhead costs End of Period $ 45,000 18,400 33,800 $ 195,000 150,000 8,000 34,500 97,500 1. Incurred other actual overhead costs (all paid in Cash) 2. Applied overhead to work in process. 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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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
Coat incurred for the period
Raw materials purchases
Factory payroll
Factory overhead (actual)
Indirect materials used
Indirect labor used
Other overhead costs
View transaction list
Beginning of
period
$ 27,000
9,500
60,000
Journal entry worksheet
<
A
1. Incurred other actual overhead costs (all paid in Cash)
2. Applied overhead to work in process.
Prepare journal entries for the above transactions for the period.
B
Note: Enter debits before credits.
Transaction
1
Record entry
$ 195,000
150,000
End of
Period
$ 45,000
18,400
33,800
Record the entry for other actual overhead costs incurred (all paid in Cash).
8,000
34,500
97,500
General Journal
Clear entry
Debit
Credit
View general journal](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4cca78d1-bc34-46b2-bd8b-917c202c12d4%2Ffe766e2c-7d3f-4a8c-8e8e-d5e8a4302ca4%2Ffbf2epc_processed.png&w=3840&q=75)
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