JOB ORDER COSTING EXAM SET Author: AHMADROSLAN All right reserved®
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JOB ORDER COSTING
EXAM SET
Author: AHMADROSLAN
All right reserved®
WHAT SHOULD YOU KNOW ?
Job order costing is used in firms that produce unique products or services
Direct materials, Direct Labor, MOH(indirect), Nonmanufacturing expense
How to determine Under/Overapplied MOHHow to calculate Predetermined Overhead
RateHow to record Journal entries for Job Order
CostingHow to record in ledger
Recording Direct and Indirect costs
1.E.g Purchased materials on account for RM30,000
Issued materials to production totaling Rm25,000
80% which was easily traced to specific jobs( Direct materials) and the rest treated as Indirect materials
How to solve this Q?
Here you are!!
First, record to the ledger Second, record to journal
Recording to ledger Journal Entries
1.Raw materials Inventory
Ac.Payable 30,000
Issued** DM 20000IDM 5,000
** 25,000X80%=20,000 utk DM25,000X20%=5000 utk I.DM
Raw material iventory
Dt 30000
Acc.payable
Cr30000
Recording LedgerDirect material- W.I.P inventoryIndirect material-MOH
1.Work in process inventory
Direct material 20,000
1.Manufacturing overhead
indirect material 5,000
Journal entriesUsing X-system
W.I.P InventoryManufaturing overhead
Dt 20000
Dt 5000
Raw material Inv Cr 25000
1.Raw materials Inventory
Issued** DM 20000IDM 5,000
1.Work in process inventory
Direct material 20,000
1.Manufacturing overhead
indirect material 5,000
Recording Direct labor and Indirect labor
E.g Payroll costs totaling RM20,000 were recorded as follows:
RM 10,000 paid for assembly workers- Direct labor RM3000 paid for Factory supervision- Indirect labor RM5000 paid for administrative personnel-
nonmanufacturing RM2000 paid for sales commission-Nonmanufacturing
P/S: Yang ni korang kene bezakan yang mana direct,indirect, nonmanufacturing expenses
How to solve this Q?
Here you are!!
First, record to the ledger Second, record to journalRecording Ledger
1.Direct labor
Wages payable 10000
1.Indirect labor
Wages payable 3000
Work in process inventory
Direct labor 10,000
Manufacturing overhead
Indirect labor 3000
Journal entries Using X-system
W.I.P inventoryManufacturing overhead
Dt 10,000
Dt 3000
Wages payable
Cr 13,000
Direct labor
Wages payable 10000
Indirect labor
Wages payable 3000
Work in process inventory
Direct labor 10,000
Manufacturing overhead
Indirect labor 3000
RM5000 paid for administrative personnel- nonmanufacturing
RM2000 paid for sales commission-Nonmanufacturing
Recording Ledger Journal EntriesNonmanufacturing
ExpensesAdministrative personnel 5000Sales commission 2,000
Administrative personnel
Dt 5000
Cash Cr 5000Sales comission Dt 2000
Cash Cr 2000
Recording MOH and NonMOH expenses
E.g Recorded deprection: RM5000 for machines- MOH Rm2000 for office copier-NonMOHHow to solve this Q?Recording Ledger
Accumulated deprecition
Deprecition for machines 5000Deprecition for office copier 2000
Manufacturing overhead
Depreciation 5000
Nonmanufacturing expenses
Depreciation 2000
Journal entries
Manufacturing overhead
Dt 5,000
Accumulated depreciation
Cr 5000
Depreciation Expenses Dt 2,000
Accumulated depreciation
Cr 2,000
Accumulated deprecition
Deprecition for machines 5000Deprecition for office copier 2000
Manufacturing overhead
Depreciation 5000
Nonmanufacturing expenses
Depreciation 2000
E.g paid RM5000 in other factory costs in cashHow to solve this Q?Recording Ledger
Manufacturing overhead
Other factory costs 5000
Cash
Other factory costs 5000
Journal entriesUsing x-system
Manufacturing overhead
Dt 5000
Cash Cr 5000
Manufacturing overhead
Other factory costs 5000
Cash
Other factory costs 5000
**Recording Applied Manufacturing overhead
Two ways to calculate Applied MOH 1. Using Predetermined overhead rates formula 2. follow the Q instruction
E.g Applied MOH at a rate of 200% of direct labor cost- 2 How to solve this Q?
First, understand the instruction Applied MOH boleh dikira dgn darabkan 200% dgn Direct
labor cost Direct Labor cost? = RM 10,000 paid for assembly workers-
Direct labor Then, 10000X200%= 20,000- APPLIED MOH What’s next?
First, korang kena tahu beza applied and actual MOH
APPLIED ACTUAL
Manufacturing overhead
Ingat, Belah DT ACTUAL Belah CR APPLIED
Then, yang korang kira tadi applied MOH tu, masukkan la belah CR
Recording MOH, and find over/under appliedMOH
Underapplied= Actual > AppliedOverapplied= Applied> Actual
APPLIED ACTUAL
Manufacturing overhead
Indirect materials 5000Indirect labor 3000Depreciation 5000Other factory 5000
AppliedManufacturing overhead 20,000
20000 20000
2,000Overapplied MOH
In this case, Applied is greater than actual. Applied=20000, Actual=18,000
Recording Work in process inventory
Untuk cari jumlah finished goods Fininshed goods yang sempurna mesti ada tiga element Direct matrials,direct
labor, Applied MOH Contoh semua job dah siap Tapi, kalau ada yang x siap mcm mana pulak? Jom I tunjuk contoh klu ada job yang xsiap
Manufacturing overhead
Direct matrials 20,000Direct labor 10,000Applied MOH 20,000
50,000 50,000
Finished goods 50,000
Kalau job ada yang x siap
E.g Completed all jobs but one(semua dah siap tapi ada satu yang xsiap lagi: the job cost sheet for this job shows RM2,000 for direct materials, RM3,000 for direct labor, and RM5000 for apllied MOH
Tambahkan semua dulu DM+DL+MOH yang xsiap ni, 2000+3000+5000= 10,000
Maksudnya di sini, 10000 ni akan jadi balance C/D coz di xsiap lg Work in process inventory
Direct matrials 20,000Direct labor 10,000Applied MOH 20,000
50,000 50,000
Finished goods 40,000Balance b/d 10,000
Balance c/d(Job yg xsiap lg )
10,000
50,000-10,00=40,000
Akan transfer ke finished goods account
Finished goods inventory account
: Work in process inventory
Direct matrials 20,000Direct labor 10,000Applied MOH 20,000
50,000 50,000
Finished goods 40,000Balance b/d 10,000
Balance c/d(Job yg xsiap lg )
10,000 Finished goods inventory
Assume beginning finished goods=15000
Balance b/d 15,000Cost of goods Manufactured 40,000
Journal entry
Finished goods inventory
Dt 40,000
W.I.P Inv Cr 40,000
When job is sold
Final step, bila job nak dijual E.g Sold job costing RM50000(harga cost); Ahmadfinance uses cost-
plus pricing with markput of 20%
Finished goods inventory
Balance b/d 15,000Cost of goods Manufactured 40,000
Cost of goods sold
50,000
When job is sold 50,000
55,0000 55,000
Balance c/d 5000
Balance b/d 5000
Journal entryUsing x-system
Cost of goods sold
Dt 50,000
Finished goods
Cr50,000
Recording sales revenue
Ahmadfinance uses cost-plus pricing with markup of 20% Cost=50,000 Markup price= 50,000X20%= 10,000 Sales price:- 50,000+10,000=60000 Recoding ledger
Sales revenue
Account receivable 50,000
Journal entry
Cash or Acc Receivable
Dt 60000
Sales revenue Cr 60,000
Over/underapplied Manufaturing
Underapplied:- Tambah dengan COGSOverapplied:- Total dengan COGSE.g overapplied RM2000
Manufacturing overhead
overapplied 2000
Cost of goods sold
50,000
Overapplied 2000
50,000
50,000
Balance c/d 48,000
Balance b/d 48,000
Manufaturing overhead
Dt 2000
COGS Cr 2000
AHMAD ROSLAN, TQ FOR USING MY WORKWhateva you
do,do well, and you may success
attend your efforts
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