At the end of August, both the Vault Bank and Take Off Airlines campaigns were completed. The costs of completed campaigns are debited to the cost of services account. Required: Journalize the four summary entries on August 31 to record each of the following for the month. Refer to the Chart of Accounts for exact wording of account titles. • Direct labor costs • Media purchases • Overhead applied • Completion of Vault Bank and Take Off Airlines campaigns
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
| August 1 Balances | |
| Vault Bank | $279,200 |
| Take Off Airlines | 78,000 |
| Sleepy Tired Hotels | 219,100 |
| Tastee Beverages | 124,900 |
| Total | $701,200 |
| Direct Labor | Media Purchases | |
| Vault Bank | $195,700 | $712,200 |
| Take Off Airlines | 88,700 | 623,600 |
| Sleepy Tired Hotels | 362,000 | 455,600 |
| Tastee Beverages | 427,400 | 336,900 |
| Total | $1,073,800 | $2,128,300 |
Journalize the four summary entries on August 31 to record each of the following for the month. Refer to the Chart of Accounts for exact wording of account titles.
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