
Concept explainers
1)
Introduction:
• Job Costing is a method of cost allocation and calculation used when the types of goods produced are specific in nature.
• The cost allocation is done for all products on basis of a specific cost estimate which is calculated by dividing the total costs for each process by the number of units produced.
• Job costing facilitates cost allocation in a simplistic manner based on the costs incurred specifically for certain units produced
Cost allocation of
• Cost allocation of Overheads takes place on basis of cost objects identified to enable cost allocation. Overheads refer to costs of operations and comprise of indirect costs in the form of selling and administrative expenses.
• Examples of Overheads are Salaries of administrative staff, rent of office, advertising expenses etc. The costs of the operations are allocated on basis of cost objects. Cost objects are units of cost allocation identified for overhead allocations and cost estimations.
• Examples of Cost objects for Overhead allocation are Number of units produced, number of labor hours worked etc.
To Determine:
Four items for direct materials and direct labor and cost allocation methodology.
2)
Introduction:
Job Costing
• Job Costing is a method of cost allocation and calculation used when the types of goods produced are specific in nature.
• The cost allocation is done for all products on basis of a specific cost estimate which is calculated by dividing the total costs for each process by the number of units produced.
• Job costing facilitates cost allocation in a simplistic manner based on the costs incurred specifically for certain units produced
Cost allocation of Overheads
• Cost allocation of Overheads takes place on basis of cost objects identified to enable cost allocation. Overheads refer to costs of operations and comprise of indirect costs in the form of selling and administrative expenses.
• Examples of Overheads are Salaries of administrative staff, rent of office, advertising expenses etc. The costs of the operations are allocated on basis of cost objects. Cost objects are units of cost allocation identified for overhead allocations and cost estimations.
• Examples of Cost objects for Overhead allocation are Number of units produced, number of labor hours worked etc.
To Determine:
Comparison of Job cost sheet with that of a Builder’s cost sheet

Want to see the full answer?
Check out a sample textbook solution
Chapter 19 Solutions
Loose Leaf for Fundamentals of Accounting Principles and Connect Access Card
- help this answer.arrow_forwardGeneral accounting questionarrow_forwardAurora Health Center has fixed costs of $240,000. After 32,000 visits, its fixed costs increase by $38,000 since it has to hire an additional front desk person to handle the additional volume. Variable costs are $5 per visit. If you are budgeting for 28,000 visits, what is your average cost per visit?arrow_forward
- Aurora Health Center has fixed costs of $240,000. After 32,000 visits, its fixed costs increase by $38,000 since it has to hire an additional front desk person to handle the additional volume. Variable costs are $5 per visit. If you are budgeting for 28,000 visits, what is your average cost per visit? Helparrow_forwardFinancial Accountingarrow_forwardfinancial accountarrow_forward
- BB Corporation reported Net sales of $4.12 million and beginning total assets of $1.08 million and ending total assets of $1.52 million. The average total asset amount is__. A. $0.39 million B. $2.85 million C. $0.32 million D. $2.48 million E. $1.30 million answerarrow_forwardProvide correct answer general Accounting questionarrow_forwardCalculate the gross profit ratio of this financial accounting questionarrow_forward
- Hello teacher please help me with accounting questionsarrow_forwardGeneral accounting questionarrow_forwardDerrington Corporation's inventory at the end of Year 2 was $195,000 and its inventory at the end of Year 1 was $183,000. The company's total assets at the end of Year 2 were $1,625,000 and its total assets at the end of Year 1 were $1,512,000. Sales amounted to $1,690,000 in Year 2. The company's total asset turnover for Year 2 is closest to_. a. 1.08 b. 9.21 c. 8.95 d. 0.98 helparrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education





