ACTG 2011 Lecture 3: Chapter 3

38 views1 pages

maroonelk473

10 Feb 2017

School

Department

Course

Professor

For unlimited access to Class Notes, a Class+ subscription is required.

Document Summary

Job order costing- small quantity of heterogeneous products, produced for order, product/services, cost by job, job cost sheet (printing shop/accounting firm) Job- single/group of units, each job given work in process ledger acct on balance sheet. Bill of material- document shows type/quantity material to make product. Material requisition- shows type/quantity material place into production. Job cost sheet- details all costs incurred to date in a job (material, labour, overhead) Time ticket- tracks labour, job/duration on employee hour-by-hour activities (dr-work process/overhead | cr-wages payable) Overhead- indirect material/labour (washroom/smoking), supervisor salary, rent, utilities, depreciation. Predetermine overhead rate = estimate overhead / estimate activity measure. Overhead applied = actual activity level x predetermine overhead rate. Accumulated overhead- indirect material/labour (dr-overhead | cr-cash, prepaid expen, deprecation) Applying overhead- period end/job completion (dr-work process | cr- overhead) Job completion- job cost sheet for completion on finish goods acct (dr-finish goods | cr-work process)

Related Questions

pleas help me ASAP

Remnant Carpet Company sells and installs commercial carpeting for office buildings. Remnant Carpet Company uses a A type of cost accounting system that provides for a separate record of the cost of each particular quantity of product that passes through the factory.job order cost system. When a prospective customer asks for a price quote on a job, the estimated cost data are inserted on an unnumbered An account in the work in process subsidiary ledger in which the costs charged to a particular job order are recorded.job cost sheet. If the offer is accepted, a number is assigned to the job, and the costs incurred are recorded in the usual manner on the job cost sheet. After the job is completed, reasons for the variances between the estimated and actual costs are noted on the sheet. The data are then available to management in evaluating the efficiency of operations and in preparing quotes on future jobs. On October 1, Remnant Carpet Company gave Jackson Consulting an estimate of $2,436 to carpet the consulting firmâs newly leased office. The estimate was based on the following data:

Estimated direct materials:
30 meters at $30 per meter	$ 900
Estimated direct labor:
16 hours at $30 per hour	480
Estimated factory overhead (75% of direct labor cost)	360
Total estimated costs	$1,740
Markup (40% of production costs)	696
Total estimate	$2,436

On October 3, Jackson Consulting signed a purchase contract, and the delivery and installation were completed on October 10.

The related The form or electronic transmission used by a manufacturing department to authorize materials issuances from the storeroom.materials requisitions and The form on which the amount of time spent by each employee and the labor cost incurred for each individual job, or for factory overhead, are recorded.time tickets are summarized as follows:

Materials Requisition No.	Description	Amount
112	15 meters at $30	$450
114	19 meters at $30	570

Time Ticket No.	Description	Amount
H10	8 hours at $30	$240
H11	12 hours at $30	360

Required:

Enter amounts as positive numbers.

1. Complete that portion of the job order cost sheet that would be prepared when the estimate is given to the customer.

2. Record the costs incurred, and complete the job order cost sheet.

JOB ORDER COST SHEET

Customer	Jackson Consulting	Date	October 1
		Date wanted	October 10
		Date completed	October 10
		Job. No.
ESTIMATE

Direct Materials

Direct Labor

Summary

Amount

ACTUAL

Direct Labor

Summary

Mat. Req. No.

Description

Amount

Time Ticket No.

Description

Amount

Item

Amount

What is the best explanation for the variances between actual costs and estimated costs. (For this purpose, assume that the additional meters of material used in the job were spoiled, the factory overhead rate has proven to be satisfactory, and an inexperienced employee performed the work.)

a.)The direct materials cost exceeded the estimate by $120 because 4 meters of materials were spoiled. The direct labor cost exceeded the estimate by $120 because an additional 4 hours of labor were used by an inexperienced employee. The factory overhead cost exceeded the estimate because an additional $90 of factory overhead was allocated because of the increase in direct labor.

b.)Management didn't provide enough direction to complete tasks on budget.

c.)The direct materials cost exceeded the estimate by $75 because 3 meters of materials were spoiled.

d.) The direct labor cost exceeded the estimate by $120 because an additional 4 hours of labor were used by an inexperienced employee.

greenbat203

And can you all please help me do the Job cost sheet 1, job cost sheet 2, general journal, to accounts ledger,

Step 1	You work for Thunderduck Custom Tables Inc. This is the first month of operations. The company designs and manufactures specialty tables. Each table is specially customized for the customer. This month, you have been asked to develop and manufacture two new tables for customers. You will design and build the tables. This is a no nail, no screw, and no glue manufacturing ( no indirect materials used). You will be keeping track of the costs incurred to manufacture the tables using Job #1 Cost Sheet and Job #2 Cost Sheet.
	The cost of the direct materials that can be used to manufacture the table are as follows. These cost are on a per unit basis.
		Table Top	$1,000.00
		Table Leg	$ 150.00
		Drawer	$ 300.00
	The company uses a job order costing system and applies manufacturing overhead to jobs based on direct labor hours.
	The company estimates that there will be 12 direct labor hours worked during the month.

	The estimated manufacturing overhead cost for the month is:
	a.	Factory supervisor salary per month	$ 2,500.00
	b.	Rent for the factory per month	$500.00
	c.	Depreciation of factory equipment per month	$600.00
		Total Estimated manufacturing overhead	$ 3,600.00

	What is the predetermined manufacturing overhead rate?		[POHR]
Step 2	The first order you received was to manufacture a table using a table top and four legs. This is your Job #1.
Step 3	The customer that has ordered Job #2, wants a table that is the same as Job #1, but wants to also add a drawer to the table.
Step 4	The following is a list of transactions that need to be recorded for the company for activity in the month of December. Record those in the "General Journal" tab of the excel file using the proper format. Please use the following accounts: Accounts Receivables, Raw materials, Work in process, Finished goods, Accumulated depreciation, Accounts payable, Salaries and wages payable, Sales revenue, Manufacturing overhead, Cost of goods sold, Salaries and wages expense, Advertising expenses, and Depreciation expense.
1-Dec	Raw Materials purchased on account, $10,000.
5-Dec	All Raw Materials needed for Job #1 were requisitioned from the material storage for use during the month. Assume all materials are direct. (After you journalize this entry please enter the information into Job #1 Cost Sheet)
10-Dec	The following employee costs were incurred but not paid during the month:
	There are three assembly employees that spend 2 hours each, $20 per hour to make the table for Job #1. (After you journalize this entry please enter the information into Job #1 Cost Sheet)
	Salary for supervisor of the factory $3,000.
	Administrative Salary $2,000.
15-Dec	All Raw Materials needed for Job #2 were requisitioned from the material storage for use during the month. Assume all materials are direct. (After you journalize this entry please enter the information into Job #2 Cost Sheet)
16-Dec	Rent for the month of December for the factory building incurred but not paid $500.
17-Dec	Advertising costs incurred but not paid for the month was $1,200.
20-Dec	Depreciation for the month of December was recorded on equipment was $750 ($150 for equipment used in the factory and the remainder for equipment used in selling and administrative activities).
22-Dec	Manufacturing overhead cost was applied based on direct labor hours to Job #1 based on the POHR determined on the "Job Cost Sheet". (After you journalize this entry please enter the information into Job #1 Cost Sheet)
26-Dec	Job #1 was completed and transferred to Finished Goods during the month.
28-Dec	The completed table from Job #1 was sold on account to the customer for $15,000 during the month. (Hint: Make sure to account for the cost of the table that was sold using the cost from the job cost sheet.)
31-Dec	Direct labor cost incurred but not paid for three employees to start manufacturing Job #2. The employees only worked one hour each, three hours total, $20 per hour during the month and they did not complete their work on the job. (After you journalize this entry please enter the information into Job #2 Cost Sheet)
31-Dec	Manufacturing overhead cost was applied based on direct labor hours to Job #2 based on the POHR. Only three direct labor hours were worked on Job #2 during the month. (After you journalize this entry please enter the information into Job #2 Cost Sheet)
31-Dec	Any underapplied or overapplied overhead for the month was closed out to Cost of Goods Sold.
Step 5	Post the journal entries that you recorded on the "General Journal" tab to the "T-accounts" tab. This is the company's first month of business, so there will not be any beginning balances. Compute the balance for each T-account after all of the entries have been posted.
Step 6	Prepare a Schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold on the "Schedule of COGM and COGS" tab for Job #1 and Job #2 that were worked on during the month by the company. Make sure to follow the format noted in your book (pg. 87). (Hint: This is the company's first month of operations and therefore the beginning balances will be zero.)
Step 7	Prepare an Income Statement for the month using the Traditional Format on the "Income Statement" tab.
Step 8	Answer the additional questions below

	Check Figure: Cost of Goods Manufactured= $3,520, Net operating income=$6,730

	What is the ending balance for raw materials?			[EndingRM]
	What is the ending balance for work in process?			[EndingWIP]
	What is the ending balance for finished goods?			[EndingFG]
	What is the actual manufacturing overhead cost incurred during December before adjustment?			[ActualMOH]
	What is the total applied manufacturing overhead cost during December before adjustment?			[AppliedMOH]
	What is the unadjusted cost of goods sold?			[UnadjustedCGS]
	Was the manufacturing overhead for the month of December overapplied/underapplied ?			[overorunderMOH]
	What is the amount of Manufacturing overhead overapplied/underapplied?			[overorunderappliedMOH]
	What is the adjusted cost of goods sold?			[AdjustedCGS]
	What is gross margin?			[Grossmargin]
	What is the total prime cost for Job#1?			[primecost]
	What is the total conversion cost for job #1?			[conversioncost]
	What is the total product cost for job#1?			[productcost]
	What was the period cost incurred for the month of December?			[periodcost]
	What is the total variable cost incurred for Job #1(assume that all selling and administrative cost and all manufacturing overhead costs are fixed.)?			[Variablecost]
	What is the contribution margin for Job #1 (assume that all selling and administrative cost and all manufacturing overhead costs are fixed.)?			[contributionmarginofjob1]
	What would be the actual (not applied) total fixed manufacturing overhead cost incurred for the company for the month if the order in Job #1 is for five tables instead of one table assuming this cost is with in the relevant range?

crimsonchinchilla53

Job Order Cost Sheet

Remnant Carpet Company sells and installs commercialcarpeting for office buildings. Remnant Carpet Company uses a joborder cost system. When a prospective customer asks for a pricequote on a job, the estimated cost data are inserted on anunnumbered job cost sheet. If the offer is accepted, a number isassigned to the job, and the costs incurred are recorded in theusual manner on the job cost sheet. After the job is completed,reasons for the variances between the estimated and actual costsare noted on the sheet. The data are then available to managementin evaluating the efficiency of operations and in preparing quoteson future jobs. On October 1, Remnant Carpet Company gave JacksonConsulting an estimate of $2,856 to carpet the consulting firmâsnewly leased office. The estimate was based on the followingdata:

Estimated direct materials:
40 meters at $30 per meter	$ 1,200
Estimated direct labor:
24 hours at $20 per hour	480
Estimated factory overhead (75% of direct labor cost)	360
Total estimated costs	$2,040
Markup (40% of production costs)	816
Total estimate	$2,856

On October 3, Jackson Consulting signed a purchasecontract, and the delivery and installation were completed onOctober 10.

The related materials requisitions and time tickets aresummarized as follows:

Materials Requisition No.	Description	Amount
112	20 meters at $30	$600
114	24 meters at $30	720

Time Ticket No.	Description	Amount
H10	12 hours at $20	$240
H11	16 hours at $20	320

Required:

Enter amounts as positive numbers.

1. Complete that portion of the job order costsheet that would be prepared when the estimate is given to thecustomer.

2. Record the costs incurred, and complete thejob order cost sheet.

JOB ORDER COST SHEET

Customer	Jackson Consulting	Date	October 1
		Date wanted	October 10
		Date completed	October 10
		Job. No.
ESTIMATE

Direct Materials

Direct Labor

Summary

Amount

ACTUAL

Direct Labor

Summary

Mat. Req. No.

Description

Amount

Time Ticket No.

Description

Amount

Item

Amount

What is the best explanation for the variances betweenactual costs and estimated costs. (For this purpose, assume thatthe additional meters of material used in the job were spoiled, thefactory overhead rate has proven to be satisfactory, and aninexperienced employee performed the work.)

a. The direct materials cost exceeded the estimate by $120because 4 meters of materials were spoiled. The direct labor costexceeded the estimate by $80 because an additional 4 hours of laborwere used by an inexperienced employee. The factory overhead costexceeded the estimate because an additional $60 of factory overheadwas allocated because of the increase in direct labor.

b. Management didn't provide enough direction to complete taskson budget.

c. The direct materials cost exceeded the estimate by $75because 3 meters of materials were spoiled.

d. The direct labor cost exceeded the estimate by $120 becausean additional 4 hours of labor were used by an inexperiencedemployee.

Materials issued for the current month are as follows:

Requisition No.	Material	Job No.	Amount
201	Aluminum	500	$85,160
202	Plastic	503	26,540
203	Rubber	504	3,960
204	Glue	Indirect	2,180
205	Steel	510	37,960

Journalize the entry on Dec. 31 to record the issuance ofmaterials. Refer to the Chart of Accounts for exact wording ofaccount titles.

CHART OF ACCOUNTS

General Ledger

	ASSETS
110	Cash
121	Accounts Receivable
125	Notes Receivable
126	Interest Receivable
131	Materials
132	Work in Process
133	Factory Overhead
134	Finished Goods
141	Supplies
142	Prepaid Insurance
143	Prepaid Expenses
181	Land
191	Factory
192	AccumulatedDepreciation-Factory

	LIABILITIES
210	Accounts Payable
221	Utilities Payable
231	Notes Payable
236	Interest Payable
241	Lease Payable
251	Wages Payable
252	Consultant Fees Payable

	EQUITY
311	Common Stock
340	Retained Earnings
351	Dividends
390	Income Summary

	REVENUE
410	Sales
610	Interest Revenue

	EXPENSES
510	Cost of Goods Sold
520	Wages Expense
531	Selling Expenses
532	Insurance Expense
533	Utilities Expense
534	Office Supplies Expense
540	Administrative Expenses
560	Depreciation Expense-Factory
590	Miscellaneous Expense
710	Interest Expense

JOURNAL

	DATE	DESCRIPTION	POST.REF.	DEBIT	CREDIT
1
2
3

A summary of the time tickets for the current month follows:

Job No.	Amount
100	$3,940
101	4,480
104	22,080
108	15,570
Indirect	6,130
111	7,120
115	7,960
117	30,690

	Required:
	Journalize the entry on Dec. 31to record the factory labor costs. Refer to the Chart of Accountsfor exact wording of account titles.

CHART OF ACCOUNTS

General Ledger

	ASSETS
110	Cash
121	Accounts Receivable
125	Notes Receivable
126	Interest Receivable
131	Materials
132	Work in Process
133	Factory Overhead
134	Finished Goods
141	Supplies
142	Prepaid Insurance
143	Prepaid Expenses
181	Land
191	Factory
192	AccumulatedDepreciation-Factory

	LIABILITIES
210	Accounts Payable
221	Utilities Payable
231	Notes Payable
236	Interest Payable
241	Lease Payable
251	Wages Payable
252	Consultant Fees Payable

	EQUITY
311	Common Stock
340	Retained Earnings
351	Dividends
390	Income Summary

	REVENUE
410	Sales
610	Interest Revenue

	EXPENSES
510	Cost of Goods Sold
520	Wages Expense
531	Selling Expenses
532	Insurance Expense
533	Utilities Expense
534	Office Supplies Expense
540	Administrative Expenses
569	Depreciation Expense-Factory
590	Miscellaneous Expense
710	Interest Expense

Journalize the entry on Dec. 31 to record the factory laborcosts. Refer to the Chart of Accounts for exact wording of accounttitles.

PAGE 10

JOURNAL

	DATE	DESCRIPTION	POST.REF.	DEBIT	CREDIT
1
2
3

brownmosquito710

ACTG 2011 Lecture 3: Chapter 3

Document Summary

Get access

Related Documents

Management and Organizational Studies 3370A/B Chapter Notes - Chapter 5: One Unit, Accounts Payable, Deutsche Luft Hansa

BUS 254 Lecture : Bus 254 chapter 3 notes.doc

ACTG 2020 Lecture Notes - Lecture 2: A143 Road, Subledger, Batch Production

Related Questions