Unit Cost, Ending Work-in-Process Inventory, Journal Entries During August, Skyler Company worked on three jobs. Data relating to these three jobs follow: Job 39 Job 40 Job 41 Units in each order 70 100 80 Units sold — 100 — Materials requisitioned $700 $690 $800 Direct labor hours 420 400 200 Direct labor cost $2,268 $2,440 $1,220 Overhead is assigned on the basis of direct labor hours at a rate of $2.20 per direct labor hour. During August, Jobs 39 and 40 were completed and transferred to Finished Goods Inventory. Job 40 was sold by the end of the month. Job 41 was the only unfinished job at the end of the month. Required: Question Content Area 1. Calculate the per-unit cost of Jobs 39 and 40. Round unit costs to nearest cent. Job 39 $fill in the blank d1e7ba00003bfe7_1 per unit Job 40 $fill in the blank d1e7ba00003bfe7_2 per unit 2. Compute the ending balance in the work-in-process inventory account. $fill in the blank d1e7ba00003bfe7_3 Question Content Area 3. Prepare the journal entries reflecting (a.) the completion of Jobs 39 and 40 and (b.) the sale of Job 40. Make the entry to record the cost of Job 40 first, followed by the entry to record the revenue from its sale. The selling price is 150 percent of cost. a. Finished Goods Work in Process b (1). Cost of Goods Sold Finished Goods b (2). Accounts Receivable Sales Revenue
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.
Unit Cost, Ending Work-in-Process Inventory,
During August, Skyler Company worked on three jobs. Data relating to these three jobs follow:
| Job 39 | Job 40 | Job 41 | |
| Units in each order | 70 | 100 | 80 |
| Units sold | — | 100 | — |
| Materials requisitioned | $700 | $690 | $800 |
| Direct labor hours | 420 | 400 | 200 |
| Direct labor cost | $2,268 | $2,440 | $1,220 |
Required:
Question Content Area
1. Calculate the per-unit cost of Jobs 39 and 40. Round unit costs to nearest cent.
| Job 39 | $fill in the blank d1e7ba00003bfe7_1 per unit |
| Job 40 | $fill in the blank d1e7ba00003bfe7_2 per unit |
2. Compute the ending balance in the work-in-process inventory account.
$fill in the blank d1e7ba00003bfe7_3
Question Content Area
3. Prepare the journal entries reflecting (a.) the completion of Jobs 39 and 40 and (b.) the sale of Job 40. Make the entry to record the cost of Job 40 first, followed by the entry to record the revenue from its sale. The selling price is 150 percent of cost.
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Finished Goods | |
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Work in Process | ||
| b (1). |
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Cost of Goods Sold | |
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Finished Goods | ||
| b (2). |
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Sales Revenue |
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