Job 44 Job 45 Direct materials $5,100 $1,500 Direct labor 1,200 3,000 Applied overhead Balance, June 1 780 1,950 $7.080 $6,450 During June, two more jobs (46 and 47) were started. The following direct materials and direct labor costs were added to the four jobs during the month of June: Job 44 Job 45 Job 46 Job 47 Direct materials $2,500 $7,110 $1,800 $1,700 Direct labor 800 6,400 900 560
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.
Prepare
Rate, Ending Balance of WIP, Finished Goods, and COGS
At the beginning of June, Rhone Company had two jobs in process, Job 44 and Job 45, with the
following accumulated cost information:
At the end of June, Jobs 44, 45, and 47 were completed. Only Job 45 was sold. On June 1, the
balance in Finished Goods was zero.
Required:
1. Calculate the overhead rate based on direct labor cost. (Note: Round to three decimal places.)
2. Prepare a brief job-order cost sheet for the four jobs. Show the balance as of June 1 as well
as direct materials and direct labor added in June. Apply overhead to the four jobs for the
month of June, and show the ending balances.
3. Calculate the ending balances of Work in Process and Finished Goods as of June 30.
4. Calculate the Cost of Goods Sold for June.
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