Explanation Job order costing : Job order costing is a method of cost accounting, in which cost is collected and accumulated for each job, work order, or project separately. Especially the job order costing is followed in organizations where customized goods are produced. The table below shows the missing amounts. Particulars Case A Case B Case C Direct material used 53,150 83,000 63,150 Direct labor 50,000 140,000 81,000 Manufacturing overhead applied 42,500 119,000 68,850 Total manufacturing costs 145,650 342,000 213,000 Work in process 1/1/17 55,850 15,500 18,000 Total cost of work in process 210,500 357,500 231,000 Less: Work in process 12/31/17 9,200 11,800 9,000 Cost of goods manufactured 192,300 345,700 222,000 Table (1) Working Notes: a. Calculate direct material used in case A. Direct Material used = ( Total manufacturing cost − Direct labor − Manufacturing overhead applied ) = $ 145 , 650 − $ 50 , 000 − $ 42 , 500 = $ 53 , 150 Therefore, the missing amount in (a) is $53,150. b. Calculate work process on 1/1/17. Work in process = ( Total cost of work in progress − Total manufacturing cost ) = $ 201 , 500 − 145 , 650 = $ 55 , 850 Therefore, the missing amount in (b) is $55,850. c. Calculate work process on 31/12/17. Work in process = ( Total cost of work in progress − Cost of goods manufactured ) = $ 201 , 500 − 192 , 300 = $ 9 , 200 Therefore, the missing amount in (c) is $9,200. d. Calculate manufacturing overhead applied. Manufacturing overhead applied = Overhead rate × Direct labor =85% × $ 140,000 =$119,000 Therefore, the missing amount in (d) is $119,000. e. Calculate total manufacturing cost. Total manufacturing cost = ( Direct Material used + Direct labor − Manufacturing overhead applied ) = $ 83 , 000 + $ 140 , 000 + $ 119 , 000 = $ 342 , 000 Therefore, the missing amount in (e) is $342,000. f. Calculate total cost of work in process. Total cost of work in process = ( Total manufacturing cost + Work in process ) = $ 342 , 000 + $ 15 , 500 = $ 357 , 500 Therefore, the missing amount in (f) is $357,500

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ISBN: 9781119769736

Author: Kimmel

Publisher: WILEY

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