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Chapter 6: Job Order Costing

Exercise 6-1

A. Pre-determined OH rate = Budgeted Manufacturing OH / B
= 1280000/3200000
= 0.4 material cost

Pre-determined OH rate = Budgeted Manufacturing OH / B
= 2200000/400000
= 5.5 machine hours

Allocation Applied OH
B. Job 1 42000 * 0.4 16,800.00
17000 * 5.5 93,500.00
110,300.00

Job 2 164000 * 0.4 65,600.00
9000 * 5.5 49,500.00
115,100.00

Job 3 78000 * 0.4 31,200.00
5800 * 5.5 31,900.00

63,100.00

C. Job 1 Job 2
Direct Materials 42,000.00 164,000.00
Direct Labor 32,000.00 26,000.00
OH Applied 110,300.00 115,100.00
Total Manufacturing Cost 184,300.00 305,100.00
Divide by: Units produced 5,000.00 7,000.00
Manufacturing Cost per Jo 36.86 43.59

D. Actual OH
Material 118,400.00
Machine 185,600.00 304,000.00
Less: Applied OH
Material 113,600.00
Machine 174,900.00 288,500.00
Underapplied OH 15,500.00

ed Manufacturing OH / Budgeted Production Activity 0/3200000 erial cost ed Manufacturing OH / Budgeted Production Activity 0/400000 hine hours .

71 .000.00 177. Job 3 78.100.00 36.100.000.000.00 63.00 10.00 17.

000.00 Predetermined Overhead rate .000.00 Job Beta ( 14000 x 12 ) 168.000.00 Job Charlie ( 10000 x 8 ) 80.00 B.00 492.00 Job Echo ( 3000 x 8 ) 24.Assembly 960.00 Predetermined Overhead rate .00 Job Delta ( 6000 x 12 ) 72.000.000.00 Job Charlie ( 9000 x 12 ) 108.Finishin 75. Exercise 6-2 A.00 .00 Divided by: Machine Hours .000. Overhead applied to production: Assembly Department Job Alpha ( 8000 x 12 ) 96.00 Total 796.00 Job Echo ( 4000 x 12) 48.000.000.000.000.00 Divided by: Direct Labor Hours .000.000.00 304.00 Job Delta ( 7500 x 8 ) 60.00 Job Beta ( 11000 x 8 ) 88.Finishing 600.000. Manufacturing Overhead .000.000.000.Ass 80.Finishi 8.00 Finishing Department Job Alpha ( 6500 x 8 ) 52.00 Manufacturing Overhead .000.Assem 12.

Gross Profit (Sold at Cost + 40% mark .000.5 ) Delta ( 6000 x 5.00 Charlie ( 3500 x 5.000.5 ) Delta ( 3200 x 5.00 30.000.00 .5 ) Echo ( 4000 x 5.000. Cost to Manufacture Each Job Job Alpha Job Beta Assembly Direct Materials 25.5 ) 9.00 88.900.000.00 275.000.00 Charlie ( 9000 x 5.5 ) Factory Overhead 52.00 168.000.00 Direct Labor Alpha ( 1800 x 5.000.5 ) 11.000.00 Beta ( 2000 x 5.00 D.900.up) Job Alpha Job Beta Assembly 165.5 ) Echo ( 2800 X 5.00 Finishing Direct Materials 12.00 25.5 ) Factory Overhead 96.000.00 Direct Labor Alpha ( 8000 x 5.000.00 Total 73.000.00 Total 165.000.5 ) 77.000.000.00 Beta ( 14000 x 5.000.C.00 275.5 ) 44.00 124.

00 628.000.00 Total 238.900.000.900.00 124.40 1.00 Balance 273.000.560.00 Less: Cost of Sales 273.00 .Finishing 73.600.000.00 449.460.600.00 449.00 179.00 Gross Profit 109.00 Add: Beginning Balance 35.900.00 399.000.00 Multiply by Mark-up (40%) 1.00 50.40 Sales Price 383.900.000.

00 22.000.00 50.000.00 25.000.000.250.00 304.00 33.000.500.00 24.00 72.600.500.00 79.500.500.00 17.000.000.000.000.00 30.00 19.000.000.00 Job Charlie Job Delta Job Echo Total 197.00 73.00 492.00 155.000.00 5.000.00 48.250.Job Charlie Job Delta Job Echo Total 40.150.150.000.400.00 155.500.500.000.00 80.00 15.00 60.00 2.00 197.00 49.00 95.000.00 225.00 .00 451.00 95.00 170.00 108.00 74.000.00 887.00 887.00 44.000.500.000.400.00 129.000.600.000.

00 1.40 457.00 - 326.150.00 234.00 44.00 328.650.338.129.440.40 1.00 - 130.00 451.00 234.00 1. .600.00 79.338.00 .00 326. - 326.00 139.00 139.600.750.400.00 1.250.900.860.750.600.00 . .700.750.00 .450.40 1.900.650. 419.

Obama (52000+44000) Work in Process.GMA 45. Exercise 6-3 A.000.000.000.000. July Less: Cost of Jobs Completed.00 Work in Process .000. beg Add: Work in Process .FVR 39.00 Work in Process . July Work in Process .000. end August Work in Process.Nixon Work in Process . August Less: Job Completed .00 .Bush Total WIP. end September Work in Process. beg Add: Work in Process .00 Total Work in Process.Nixon 39.Obama Work in Process .Nixon 30.00 Work in Process .Obama 44.Bush Work in Process.GMA 47.00 Work in Process .

00 GMA (47000 + 45000) 92. August August Jobs Completed. September Less: Jobs Completed Nixon ( 39000 + 41000 + 30000) 110.000.00 Work in Process.FVR 36.000.00 Total Work in Process. September September Jobs Completed. Work in Process .August Multiply : GP rate Gross Profit. July Jobs Completed. end B.000.July Multiply : GP rate Gross Profit. October .September Multiply : GP rate Gross Profit.

00 93.00 93.00 12.00 96.000.00 166.000.00 41.000.00 .000.00 169.000. 52.000.000.000.00 166.000.000.000.00 12.000.00 105.00 262.

000.000.000.00 0.111.800.400.40 38.00 202.40 80.00 0.00 277.40 4.000.00 0.000.000.00 75.00 202.800.00 .000.00 96.00 12.

500 Cost of Sales Jobs Sold.Issued Purchases . Bal.Jobs Sold Completed-1.000 Maintenance .375. Bal.000 Overapplied .Exercise 6-4 Raw Materials Beg.000 Direct Labor.057.105.. . 60.Completed Materials.Applied OH Indirect Labor-75.30.000 Insurance .349.000 Misc.349.250.000 Work in Process Beg.000 Finished Goods Beg.000 End. Bal.000 .000 350. .500 .000 Overhead.000 . .000 Rent .000 1.12.1. Bal.100.000 Electricity .000 1.20.500 Manufacturing Overhead Indirect Mat.000 Tax&Licenses-12.000 .000 End..232.000 500.000 End. 36.475.250. Bal .25.720. Bal. 427.000 . Cost . 250.650.057.

000 x 25%) Factory Overhead (62.000 x 30%) Factory Overhead (75.000 x 140%) Job 800 .000 x 30%) Direct Labor (250.Unfinished Direct Materials (500.Completed and in the warehouse Beginning Balances Add: Direct Materials (500.500 x 140%) Total Job 600 .Sold Direct Materials (500.000 x 20%) Factory Overhead (50.000 x 15%) Direct Labor (250.000 x 25%) Direct Labor (250.Sold Beginning Balances Add: Direct Materials (500.Job 500 .000 x 25%) Direct Labor (250.000 x 140%) Total Job 700 .000 x 25%) .

000 x 140%) 2.) (a. end Cost of Goods Completed (c. beginning Add: Factory Cost Total cost put into process Less: Work in process.Adjusted .000 x 95%) Direct Labor Factory Overhead (250.000 x 140%) Total Factory Cost (b.) Work in Process.) Balances Divided by Percentage Multiply by Overapplied Overhead Adjusted Amount Cost of Goods Manufactured Add: Finished Goods.beginning Cost of Goods Available for Sale Less: Unsold Job Cost of Goods Sold Less: Overapplied overhead Cost of Sales .Factory Overhead (50.) Direct Materials (500.

) Work in Process. beginning Add: Direct Materials Direct Labor Factory Overhead Total Less: Job Completed Overapplied Overhead Work in Process. beginning Add: Jobs Completed Total Less: Jobs Sold Job 500 Job 600 Job 700 Job 800 Balance Less: Overapplied Overhead Finished Goods.(d. end Beginning Balance Add: Raw Materials Purchased Total Less: Materials used in production Raw Materials. end Finished Goods. end .

end Cost of Goods Manufactured Add: Finished Goods. Manila Manufacturing Company Statement of Cost of Goods Manufactured and S For the month ended September 20. 2020 Work in Process.end Cost of Goods Sold .beginning Less: Finished Goods.beginning Add: Direct Materials Direct Labor Factory Overhead Total Cost Put into Process Less: Work in Process.

000 45.000 75.500 Direct Materials Direct Labor Factory Overhead 15.000 Direct Materials Direct Labor Factory Overhead 75.000 150.000 50.000 30.000 72.000 70.500 87.000 48.000 62.000 125.500 147.000 Direct Materials Direct Labor Factory Overhead 125.500 .000 105.Direct Materials Direct Labor Factory Overhead 22.500 159.000 165.000 105.000 62.000 150.000 110.

052.000.00 427.329 1.000 427.279.000 105.052.1218 0.374.000 232.000 1.6698 105.500.00 2.075.000 105.075.000 12.057.307.057.000 1.000.00 0.000. 70.171 .000 1.789 21.000 475.00 2.872 70.349.2083 0.000 1.052.000 250.00 1.500 1.000 250.329 1.000.000 1.500.500 70.000 720.000 350.000 Work in Process Finished Goods Cost of Sales 250.00 2.777.

000 417.057.057.777.000 207.000 475.500 427.000 420.000 1.000 1.000 12.000 250.000 .000 245.211 720.000 1.000 500.289.500 21.000 350.000 1. 232.789 237.000 1.075.000 650.000 250.000 750.872 405.628 100.500 1.307.

332.000 1.789 720.160 .000 237.094.000 350.629 1.409.211 1.nila Manufacturing Company Cost of Goods Manufactured and Sold month ended September 20.075.000 250. 2020 232.000 1.000 475.000 405.

End Less: Raw materials.Exercse 6-5 Work in Process. beginning Raw materials Purchased .6000 Job 104 . beginning Less: Direct Materials (6000+8000) Direct Labor (3.500 ) Factory Overhead Divide by: Direct Labor Overhead Rate Direct Materials Issued to Production Job 101 .3000 Job 102 .2000 Job 103 .4500 Add: Raw materials.000+2.

800 Cash 14.6 3. Work in Process-D 3300 RMI 5500 0.000 5500 2. Finished Goods 15500 Work In Process 18000 15000 18500 . Factory Payroll Cash 4. Work In Process.D Factory Payroll 5. Entries 1. Raw Materials Inven 22.

18500 18500 15500 15500 7500 7500 7500 ry Payroll 7500 32440 In Process 32440 .