05 job-order costing
TRANSCRIPT
-
8/4/2019 05 Job-Order Costing
1/28
PPT 5 -1
AGUS SISWANDI
01153056
MANAGEMENT ACCOUNTING
-
8/4/2019 05 Job-Order Costing
2/28
PPT 5 -2
Chapter Five
Job-OrderCosting
-
8/4/2019 05 Job-Order Costing
3/28
PPT 5 -3
Learning Objectives
Describe the differences between job-
order costing and process costing, and
identify the types of firms that would useeach method.
Describe the cost flows and prepare the
journal entries associated with job-ordercosting.
-
8/4/2019 05 Job-Order Costing
4/28
PPT 5 -4
Learning Objectives (continued)
Identify and set up the source documents
used in job-order costing.
-
8/4/2019 05 Job-Order Costing
5/28
PPT 5 -5
Comparison of Job-Order and
Process Costing
Job-Order Costing Process Costing
1. Wide variety of distinct 1. Homogeneous products
products
2. Cost accumulated by job 2. Costs accumulated by
process or department
3. Unit cost computed by 3. Unit cost computed by
dividing total job costs dividing process costs of
by units produced on that the period by the unitsjob produced in the period
-
8/4/2019 05 Job-Order Costing
6/28
PPT 5 -6
Johnson Leathergoods - Example
Suppose that Stan Johnson forms a new company, Johnson
Leathergoods, which specializes in the production of custom
leather products. Stan believes that there is a market for
one-of-a-kind leather purses, briefcases, and backpacks. Inits first month of operation, he obtains two orders: the first
is for 20 leather backpacks for a local sporting goods store;
the second is for 10 distinctively tooled briefcases for the
coaches of a local college. Stan agrees to provide these
orders at a price of cost plus 50 percent.
-
8/4/2019 05 Job-Order Costing
7/28
PPT 5 -7
Johnson Leathergoods - Unit Cost
Direct materials $1,000
Direct labor 1,080
Overhead 240
Total cost $2,320
number of units 20
Unit cost $ 116======
-
8/4/2019 05 Job-Order Costing
8/28
PPT 5 -8
Job-Order Costing
Material Purchases
A. Raw materials account is debited for the cost of
materials purchased
Raw Materials Work in Process
(A)
-
8/4/2019 05 Job-Order Costing
9/28
PPT 5 -9
Exercise 5-10
A. Materials costing $3,000 were purchased on
account.
Raw Materials 3,000
Accounts Payable 3,000
-
8/4/2019 05 Job-Order Costing
10/28
PPT 5 -10
Job-Order Costing
Material Requisitions
B. Raw Materials is credited for the cost of materials
issued to jobs.
Work in Process is debited for the cost of materials
issued to jobs.Raw Materials Work in Process
(A) (B) (B)
-
8/4/2019 05 Job-Order Costing
11/28
PPT 5 -11
Exercise 5-10 (continued)
B. Materials totaling $1,700 were requisitioned
for use in production, $500 for Job 443 and the
remainder for Job 444.
Work in Process 1,700
Raw Materials 1,700
-
8/4/2019 05 Job-Order Costing
12/28
PPT 5 -12
Job-Order Costing
Direct Labor Incurred
C. Wages Payable is credited for the cost of direct labor.
Work in Process is debited for the cost of direct labor.
Wages Payable Work in Process
(C) (C)
-
8/4/2019 05 Job-Order Costing
13/28
PPT 5 -13
Exercise 5-10 (continued)
C. During the month, direct laborers worked 50
hours on Job 443 and 100 hours on Job 444.
Direct laborers are paid at the rate of $8 per
hour.
Work in Process 1,200
Wages Payable 1,200
-
8/4/2019 05 Job-Order Costing
14/28
PPT 5 -14
Job-Order Costing
Actual Overhead
D. Overhead Control is debited for actual overhead.
Overhead Control Work in Process
(D)
-
8/4/2019 05 Job-Order Costing
15/28
PPT 5 -15
Exercise 5-10 (continued)
D. Actual overhead for the month was $1,230 and
was paid in cash.
Overhead Control 1,230
Cash 1,230
J b O d C i
-
8/4/2019 05 Job-Order Costing
16/28
PPT 5 -16
Job-Order Costing
Applied Overhead
E. Overhead Control is credited for applied overhead.
Work in Process is debited for applied overhead.
Overhead Control Work in Process
(D)(E) (E)
-
8/4/2019 05 Job-Order Costing
17/28
PPT 5 -17
Exercise 5-10 (continued)
E. Overhead is applied using a plantwide rate of
$7.50 per direct labor hour.
Work in Process 1,125
Overhead Control 1,125
J b O d C i
-
8/4/2019 05 Job-Order Costing
18/28
PPT 5 -18
Job-Order Costing
Transfer of Completed Goods
F. Credit Work in Process for the COGM.
Debit Finished Goods for the COGM.
Work in Process Finished Goods
(B)
(C)
(E)
(F) (F)
-
8/4/2019 05 Job-Order Costing
19/28
PPT 5 -19
Exercise 5-10 (continued)
F. Job 443 was completed and transferred to
Finished Goods.
Finished Goods 1,275
Work in Process 1,275
J b O d C ti
-
8/4/2019 05 Job-Order Costing
20/28
PPT 5 -20
Job-Order Costing
Recognition of Expense
G. Credit Finished Goods for value of units sold.
Debit Cost of Goods Sold for value of units sold.
Finished Goods Cost of Goods Sold
(G) (G)
-
8/4/2019 05 Job-Order Costing
21/28
PPT 5 -21
Exercise 5-10 (continued)
G. Job 442, which had been completed and
transferred to Finished Goods in March, was
sold on account for cost ($2,000) plus 25
percent.
Cost of Goods Sold 2,000
Finished Goods 2,000
Accounts Receivable 2,500
Sales Revenue 2,500
-
8/4/2019 05 Job-Order Costing
22/28
PPT 5 -22
General Contractor Example
Direct Materials House #1 $ 90,000
House #2 100,000
House #3 30,000
Direct Labor House #1$65,000
House #2 70,000
House #3 15,000
Overhead is applied at 50 percent of DLC.
Houses #1 and #2 are completed during the period
House #1 is sold for $200,000 cash.
-
8/4/2019 05 Job-Order Costing
23/28
PPT 5 -23
General Contractor Example Solution
Work in Process Finished Goods
(1) 220,000 (4) 187,500
(2) 150,000 (4) 187,500 (5) 205,000 (6) 187,500
(3) 75,000 (5) 205,000
52,500 205,000
Cost of Goods Sold
(6) 187,500
187,500
-
8/4/2019 05 Job-Order Costing
24/28
PPT 5 -24
Job Cost Sheets for Example
(1) 90,000 (2) 65,000 (3) 32,500 (1) 100,000 (2) 70,000 (3) 35,000
187,500 205,000
House #1 House #2
House #3
(1) 30,000 (2) 15,000 (3) 7,500
52,500
-
8/4/2019 05 Job-Order Costing
25/28
PPT 5 -25
A Job Order Cost Sheet
Item Description: _________ Job Order Number: _______Quantity Competed: ______ Date Started: _____________
Date Completed:_________
Direct Materials Direct Labor Overhead
Req. No. Amount Ticket # Hours Rate Amt. Hours Rate Amt.
24-A $500 49 40 $10 $400 40 $1.60 $6446-B 650 71 30 8 240 30 3.00 90
Cost Summary
Direct Materials_______ Total Costs_________Direct Labor _______ Unit Cost _________Overhead _______
$1,150$640
$154
$1,944$19.44
Drill Bits100
16-C1/25/01
1/31/01
-
8/4/2019 05 Job-Order Costing
26/28
PPT 5 -26
A Materials Requisition Form
Requisition No._______Date:______ Department___________ Job No._____
Description Quantity Cost/Unit Total Cost
Delivered By___________ Received by______________
24-A1/25/01 Fabrication 16-C
Steel Stock 100 $5.00 $500
J. Jones D. Reller
-
8/4/2019 05 Job-Order Costing
27/28
PPT 5 -27
A Job Time Ticket
Employee No.______ Name____________ Date_________
Start Time Stop Time Total Time Rate Amt. Job No.
10:00 a.m. 4:00 p.m. 6.0 hours $10 $60 16-C
Ticket No._________49
101 F. Flintstone 1/24/01
Approved by __________________________Department Supervisor
-
8/4/2019 05 Job-Order Costing
28/28
PPT 5 -28
End of Chapter 5