Job Order Costing

Journal Entries
 Journal Entries For Materials
Supplier Store Production
A/P Materials WIP
1) Raw Material (both direct and indirect) is
purchased:
Raw materials 10,000
Accounts Payable 10,000
2) Direct material of Rs. 8000 and indirect material
of Rs.2,000 was issued to production
WIP 8,000
FOH Control 2,000
Material 10,000
 Journal Entries For Payroll
1) We record payroll with deductions
Payroll 100,000
Income Tax @ 10% 10,000
Provident Fund @ 5% 5,000
Accrued Payroll 85,000
2) Payment of payroll
Accrued payroll 85,000
Bank Account 85,000
3) Segregation of Payroll
WIP 80,000
FOH Control 20,000
Payroll 100,000

OR
Net Entry
WIP 80,000
FOH Control 20,000
Income Tax @ 10% 10,000
Provident Fund @ 5% 5,000
Bank Account 85,000
 Journal Entries For FOH Applied
1) When FOH is applied
WIP 16,000
Applied FOH 16,000
2) FOH applied will be compared to actual FOH
Applied FOH 16,000
FOH Control 16,000
Journal Entries For Completion Of Job

When goods are completed

Finished Goods 15,000
WIP 15,000
 When goods are sold
1) Cost of goods sold 12,000
Finished goods 12,000
2) Accounts Receivable 22,000
Sales 22,000
 Under or over applied FOH
Prepare FOH Control Account
FOH Control Account
Mat. 2000 App. FOH 16,000
Payroll 20,000
CGS 6000
22000 22000
CGS 6,000
FOH Control 6,000