Fabric $205,000 Polyester Filling $ 75,000 Glue Lumber $120,000 Total Job 601 $400,000 Job 602 110,000 36,000 88,000 234,000 Job 603 130,000 55,000 125,000 310,000 Factory overhead-indirect materials $34,800 $333,000 $34,800 34,800 Total $445,000 $166,000 $978,800
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.
Entries for materials
GenX Furnishings manufactures designer furniture. GenX Furnishings
uses a
ledger are as follows:
| Fabric Polyester filling Lumber Glue |
$40,500 28,600 62,400 6,550 |
The materials purchased during June are summarized from the
receiving reports as follows:
| Fabric Polyester filling Lumber Glue |
$ 440,000 130,000 360,000 40,000 |
Materials were requisitioned to individual jobs as attached:
The glue is not a significant cost, so it is treated as indirect materials
(factory overhead).
a.
b. Journalize the entry to record the requisition of materials in June.
c. Determine the June 30 balances that would be shown in the materials
ledger accounts.
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