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This 3 page Class Notes was uploaded by Nikita Hendricks on Sunday September 25, 2016. The Class Notes belongs to 2304 at Baylor University taught by Prof. Stuebs in Fall 2016. Since its upload, it has received 3 views. For similar materials see Managerial Accounting in Accounts at Baylor University.
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Date Created: 09/25/16
MANAGERIAL ACCOUNTING Job Order Costing Direct materials those materials that can be directly traced to, or easily identified with, the final product. Direct labor the costs are the wages (and possibly benefits) paid to the workers who transform direct materials into a finished product. Direct labor hours the time the workers spend working on a particular product Overhead Costs the indirect product costs that arise in the manufacturing process and that cannot easily be traced to a unit of product. Indirect materials supplies used in in supporting the production process, which may or may not be apart of the final product. Indirect Labor includes the labor cost of all the workers who support the production process. Examples: Janitors who clean, supervisors, and guards to enforce security. period cost or nonmanufacturing cost associated with the selling of products and the administration of the business. Selling Costs costs that are associated with the storage, sale, and delivery of finished goods. general and administrative costs a category that includes all the costs associated with the general management of the company. Product Costs DM, DL, Electricity, Indirect materials, machine depreciation, factory rent, production manager's salary. Period Costs Sales commission, packaging for delivery, depreciation on delivery trucks, marketing vice president's salary, Advertising. Raw Materials Inventory when the company purchases raw materials for use in the production process, the costs of those materials is recorded in raw materials inventory. Supplies Inventory record the cost of indirect materials and direct materials. Work in process inventory account records the costs of all products that have been started but are not yet complete. DL and manufacturing overhead are recorded in Work in process inventory. Finished goods the final inventory. Records all the production costs of completed products. Ending Balance equation Ending Balance=Beg. balance+ costs added during the periodCosts removed during the period. Costs of goods manufactured the cost of everything that is finished during the period, whether or not it was started during the period. Total manufacturing costs incurred during the periodthe direct materials used in the production, direct labor incurred, and manufacturing overhead incurred. Total Manufacting Cost Equation Total Manufacturing Cost=DMused +DL+MOH Cost of Goods Manufactured Equation Cost of Goods Manufactured=Total Manufacturing costs+WIPbeg.+WIPend. Job Order Costing System products are manufactured in batches or jobs, and product costs are accumulated for each batch or job. Job cost sheet accumulates and summarizes all the costs incurred during the job. Applied overhead equation Applied Overhead=Predetermined overhead rate * Actual amount of application base Underapplied overhead not enough overhead cost was charged to products as they were made. Overapplied overhead more overhead was recorded in the WIP inventory account than was actually incurred during the period. Predetermined Overhead rate Equation Predetermined overhead rate= (Budgeted total manufacturing overhead/Budgeted level of application base)
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