Chapter 20, Problem 20.1AP

(a)

To determine

Job Order Costing: The job order costing is a method of cost accounting. Under this method, costs are given to each job and for each lot of goods. Each batch or each job has a different feature. The cost for each job is computed by using this method.

Journalizing: It is the process of recording the transactions of an organization in a chronological order. Based on these journal entries recorded, the amounts are posted to the relevant ledger accounts.

Accounting rules for journal entries:

• To increase the balance of the account: Debit assets, expenses, losses and credit all liabilities, capital, revenue, and gains.
• To decrease the balance of the account: Credit assets, expenses, losses and debit all liabilities, capital, revenue, and gains.

To determine: The predetermined overhead rate.

(b)

To determine

To prepare: The job cost sheets.

(c)

To determine

To prepare: The journal entries to record the transactions.

(d)

To determine

To prepare: The journal entries to record the transactions and posting of costs to the cost sheets.

(e)

To determine

To prepare: The job cost sheets showing the total and the entry to record the transaction.

(f)

To determine

To prepare: The entry to record the transaction of sale of any job.

(g)

To determine

To prepare: The T-account for the finished goods inventory.

(h)

To determine

The under or over applied overhead.