Blue Devil Corp. is a manufacturer that uses job-order costing method. The company applies overhead cost to jobs on the basis of direct labor hours. At the beginning of current year, the company expects $800,000 of total manufacturing overhead incurred and an estimated activity level of 100,000 direct labor hours. Due to the greater than expected demand for its product, the company worked 110,000 direct labor hours during this year. And the actual manufacturing overhead incurred include 80,000 indirect materials cost, 120,000 indirect labor cost, 200,000 utilities in plant, 448,000 depreciation expenses of equipment and buildings used for manufacturing. A. Prepare the journal entry to adjust the overapplied or underapplied manufacturing overhead cost. Assume that the dollar amount to adjust is an insignificant number.
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.
Blue Devil Corp. is a manufacturer that uses job-order costing method. The company applies
Due to the greater than expected demand for its product, the company worked 110,000 direct labor hours during this year. And the actual manufacturing overhead incurred include 80,000 indirect materials cost, 120,000 indirect labor cost, 200,000 utilities in plant, 448,000
A. Prepare the
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