Scribd
Upload
176 views

Cost Accounting: Basic Concepts and Job Order Cost Cycle

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.

Uploaded by

Janine Alexis Tividad
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
176 views

Cost Accounting: Basic Concepts and Job Order Cost Cycle

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.

Uploaded by

Janine Alexis Tividad
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 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

You might also like