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    Cost Accounting: Basic Concepts and Job Order Cost Cycle

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    Janine Alexis Tividad
    The document provides a summary of key concepts in cost accounting and the job order cost cycle. It includes sample self-check test questions and answers about types of manufacturing costs, budgets, prime costs, applied vs actual overhead, and conversion costs. It also provides a sample problem and journal entries for a company's transactions during a month, including materials purchases, labor costs, overhead application, production costs, cost of goods sold, and sales.

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    Cost Accounting: Basic Concepts and Job Order Cost Cycle

    Uploaded by

    Janine Alexis Tividad
    155 views18 pages
    The document provides a summary of key concepts in cost accounting and the job order cost cycle. It includes sample self-check test questions and answers about types of manufacturing costs, budgets, prime costs, applied vs actual overhead, and conversion costs. It also provides a sample problem and journal entries for a company's transactions during a month, including materials purchases, labor costs, overhead application, production costs, cost of goods sold, and sales.

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    Practice-Exercises-Answer

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    The document provides a summary of key concepts in cost accounting and the job order cost cycle. It includes sample self-check test questions and answers about types of manufacturing costs, budgets, prime costs, applied vs actual overhead, and conversion costs. It also provides a sample problem and journal entries for a company's transactions during a month, including materials purchases, labor costs, overhead application, production costs, cost of goods sold, and sales.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    155 views18 pages

    Cost Accounting: Basic Concepts and Job Order Cost Cycle

    Uploaded by

    Janine Alexis Tividad
    The document provides a summary of key concepts in cost accounting and the job order cost cycle. It includes sample self-check test questions and answers about types of manufacturing costs, budgets, prime costs, applied vs actual overhead, and conversion costs. It also provides a sample problem and journal entries for a company's transactions during a month, including materials purchases, labor costs, overhead application, production costs, cost of goods sold, and sales.

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    You are on page 1of 18

    COST ACCOUNTING

    CHAPTER 1
    BASIC CONCEPTS AND JOB ORDER COST CYCLE
    Answer to Self-Check Test
    The glue used in manufacturing armchairs and the thread used
    in sewing a suit are classified as this type of manufacturing
    cost. (Be specific)

    Answer:
    INDIRECT MATERIAL/S

    MANUFACTURING OR FACTORY OVERHEAD


    Answer to Self-Check Test
    It is the overall financial plan for future
    activities.

    Answer:
    BUDGET OR FINANCIAL BUDGET
    Answer to Self-Check Test
    Reflects the primary sources of costs for
    units in production.

    Answer:
    PRIME COSTS
    (Direct Materials + Direct Labor)
    Answer to Self-Check Test
    If the applied overhead is greater than the actual
    costs incurred, the manufacturing overhead control
    account will have a credit balance that will be
    called as

    Answer:
    OVER-APPLIED OVERHEAD
    Answer to Self-Check Test
    Indicates the costs required to convert the raw
    materials into finished products.

    Answer:
    CONVERSION COSTS
    PROBLEM 1-2
    The general ledger of the Jaja Bearings Company
    contained the following accounts, among others, on
    January 1: Finished goods, P15,000; Work in
    process, P30,000; Materials, P25,000. During
    January, the following transactions were completed:
    a. Materials were purchased on account at
    a cost of P13,500.

    Materials 13,500
    Accounts payable 13,500
    b. Steel in the amount of P17,500 was
    issued from factory.

    Work in process 17,500


    Materials 17,500
    c. Requisitions for indirect materials and
    supplies amounted to P1,800.

    Factory overhead control 1,800


    Materials 1,800
    d. The total payroll for January amounted to P27,000,
    including marketing salaries of P5,000 and administrative
    salaries of P3,000. Job time tickets show that P17,000 of the
    labor cost was direct labor. A payroll clearing accounts used.

    Payroll 27,000
    Accrued payroll 27,000
    Labor cost distribution:

    Work in process 17,000


    Factory overhead control 2,000
    Selling expense 5,000
    Administrative expense 3,000
    Payroll 27,000
    e. Various indirect manufacturing costs totaling
    P2,508 were paid in cash.

    Factory overhead control 2,508


    Cash 2,508
    f. Various indirect manufacturing costs totaling
    P8,500 were incurred on account.

    Factory overhead control 8,500


    Accounts Payable 8,500
    g. Total factory overhead is charged to work
    in process.

    Work in process 14,808


    Factory overhead control 14,808
    h. Cost of production completed in January totaled
    P60,100 and finished goods on January totaled P15,100.

    Finished goods 60,100


    Work in process 60,100
    i. Customers to whom shipments were made
    during the month were billed for P75,000.

    Accounts receivable 75,000


    Sales 75,000
     
    Cost of goods sold 60,000
    Finished goods 60,000
    Finished goods, Jan. 1 P15,000
    Cost of production 60,100
    Finished goods, Jan 31 (15,100)
    Cost of good sold P60,000

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