Remnant Carpet Company sells and installs commercial carpeting for office buildings. Remnant Carpet Company uses a job order cost system. When a prospective customer asks for a price quote on a job, the estimated cost data are inserted on an unnumbered job cost sheet. If the offer is accepted, a number is assigned to the job, and the costs incurred are recorded in the usual manner on the job cost sheet. After the job is completed, reasons for the variances between the estimated and actual costs are noted on the sheet. The data are then available to management in evaluating the efficiency of operations and in preparing quotes on future jobs. On October 1, Remnant Carpet Company gave Jackson Consulting an estimate of $2,716 to carpet the consulting firm’s newly leased office. The estimate was based on the following data: Estimated direct materials: 30 meters at $32 per meter $ 960 Estimated direct labor: 28 hours at $20 per hour 560 Estimated factory overhead (75% of direct labor cost) 420 Total estimated costs $1,940 Markup (40% of production costs) 776 Total estimate $2,716 On October 3, Jackson Consulting signed a purchase contract, and the delivery and installation were completed on October 10. The related materials requisitions and time tickets are summarized as follows: Materials Requisition No. Description Amount 112 15 meters at $32 $480 114 19 meters at $32 608 Time Ticket No. Description Amount H10 14 hours at $20 $280 H11 18 hours at $20 360 Required: Enter amounts as positive numbers. 1. Complete that portion of the job order cost sheet that would be prepared when the estimate is given to the customer. 2. Record the costs incurred, and complete the job order cost sheet. JOB ORDER COST SHEET Customer Jackson Consulting Date October 1 Date wanted October 10 Date completed October 10 Job. No. ESTIMATE Direct Materials Direct Labor Summary Amount Amount Amount 30 Meters at $32 $fill in the blank 8f7704033055032_1 28 Hours at $20 $fill in the blank 8f7704033055032_2 Direct Materials $fill in the blank 8f7704033055032_3 Direct Labor fill in the blank 8f7704033055032_4 Factory Overhead fill in the blank 8f7704033055032_5 Total $fill in the blank 8f7704033055032_6 Total $fill in the blank 8f7704033055032_7 Total cost $fill in the blank 8f7704033055032_8 ACTUAL Direct Materials Direct Labor Summary Mat. Req. No. Description Amount Time Ticket No. Description Amount Item Amount 112 15 Meters at $32 $fill in the blank 8f7704033055032_9 H10 14 Hours at $20 $fill in the blank 8f7704033055032_10 Direct Materials $fill in the blank 8f7704033055032_11 Direct Labor fill in the blank 8f7704033055032_12 114 19 Meters at $32 fill in the blank 8f7704033055032_13 H11 18 Hours at $20 fill in the blank 8f7704033055032_14 Factory Overhead fill in the blank 8f7704033055032_15 Total $fill in the blank 8f7704033055032_16 Total

Remnant Carpet Company sells and installs commercial carpeting for office buildings. Remnant Carpet Company uses a job order cost system. When a prospective customer asks for a price quote on a job, the estimated cost data are inserted on an unnumbered job cost sheet. If the offer is accepted, a number is assigned to the job, and the costs incurred are recorded in the usual manner on the job cost sheet. After the job is completed, reasons for the variances between the estimated and actual costs are noted on the sheet. The data are then available to management in evaluating the efficiency of operations and in preparing quotes on future jobs. On October 1, Remnant Carpet Company gave Jackson Consulting an estimate of $2,716 to carpet the consulting firm’s newly leased office. The estimate was based on the following data: Estimated direct materials: 30 meters at $32 per meter $ 960 Estimated direct labor: 28 hours at $20 per hour 560 Estimated factory overhead (75% of direct labor cost) 420 Total estimated costs $1,940 Markup (40% of production costs) 776 Total estimate $2,716 On October 3, Jackson Consulting signed a purchase contract, and the delivery and installation were completed on October 10. The related materials requisitions and time tickets are summarized as follows: Materials Requisition No. Description Amount 112 15 meters at $32 $480 114 19 meters at $32 608 Time Ticket No. Description Amount H10 14 hours at $20 $280 H11 18 hours at $20 360 Required: Enter amounts as positive numbers. 1. Complete that portion of the job order cost sheet that would be prepared when the estimate is given to the customer. 2. Record the costs incurred, and complete the job order cost sheet. JOB ORDER COST SHEET Customer Jackson Consulting Date October 1 Date wanted October 10 Date completed October 10 Job. No. ESTIMATE Direct Materials Direct Labor Summary Amount Amount Amount 30 Meters at $32 $fill in the blank 8f7704033055032_1 28 Hours at $20 $fill in the blank 8f7704033055032_2 Direct Materials $fill in the blank 8f7704033055032_3 Direct Labor fill in the blank 8f7704033055032_4 Factory Overhead fill in the blank 8f7704033055032_5 Total $fill in the blank 8f7704033055032_6 Total $fill in the blank 8f7704033055032_7 Total cost $fill in the blank 8f7704033055032_8 ACTUAL Direct Materials Direct Labor Summary Mat. Req. No. Description Amount Time Ticket No. Description Amount Item Amount 112 15 Meters at $32 $fill in the blank 8f7704033055032_9 H10 14 Hours at $20 $fill in the blank 8f7704033055032_10 Direct Materials $fill in the blank 8f7704033055032_11 Direct Labor fill in the blank 8f7704033055032_12 114 19 Meters at $32 fill in the blank 8f7704033055032_13 H11 18 Hours at $20 fill in the blank 8f7704033055032_14 Factory Overhead fill in the blank 8f7704033055032_15 Total $fill in the blank 8f7704033055032_16 Total

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter2: Job Order Costing

Section: Chapter Questions

Problem 3PA: Job cost sheet Remnant Carpet Company sells and installs commercial carpeting for office buildings....

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Question

Estimated direct materials:
30 meters at $32 per meter	$ 960
Estimated direct labor:
28 hours at $20 per hour	560
Estimated factory overhead (75% of direct labor cost)	420
Total estimated costs	$1,940
Markup (40% of production costs)	776
Total estimate	$2,716

On October 3, Jackson Consulting signed a purchase contract, and the delivery and installation were completed on October 10.

The related materials requisitions and time tickets are summarized as follows:

Materials Requisition No.	Description	Amount
112	15 meters at $32	$480
114	19 meters at $32	608

Time Ticket No.	Description	Amount
H10	14 hours at $20	$280
H11	18 hours at $20	360

Required:

Enter amounts as positive numbers.

1. Complete that portion of the job order cost sheet that would be prepared when the estimate is given to the customer.

2. Record the costs incurred, and complete the job order cost sheet.

JOB ORDER COST SHEET

Customer	Jackson Consulting	Date	October 1
		Date wanted	October 10
		Date completed	October 10
		Job. No.
ESTIMATE

Direct Materials

Direct Labor

Summary

Amount

30 Meters at $32

$fill in the blank 8f7704033055032_1

28 Hours at $20

$fill in the blank 8f7704033055032_2

Direct Materials

$fill in the blank 8f7704033055032_3

Direct Labor

fill in the blank 8f7704033055032_4

Factory Overhead

fill in the blank 8f7704033055032_5

Total

$fill in the blank 8f7704033055032_6

Total

$fill in the blank 8f7704033055032_7

Total cost

$fill in the blank 8f7704033055032_8

ACTUAL

Direct Materials

Direct Labor

Summary

Mat. Req. No.

Description

Amount

Time Ticket No.

Description

Amount

Item

Amount

112

15 Meters at $32

$fill in the blank 8f7704033055032_9

H10

14 Hours at $20

$fill in the blank 8f7704033055032_10

Direct Materials

$fill in the blank 8f7704033055032_11

Direct Labor

fill in the blank 8f7704033055032_12

114

19 Meters at $32

fill in the blank 8f7704033055032_13

H11

18 Hours at $20

fill in the blank 8f7704033055032_14

Factory Overhead

fill in the blank 8f7704033055032_15

Total

$fill in the blank 8f7704033055032_16

Total

Expert Solution

Step 1: Understanding Job Costing and its process

Meaning:

Job Costing : It a method of calculating cost of a particular job, work, contract. It is the category of basic costing method which is applicable where the work consists of separate contract, jobs, or batches each of which is authorized by specific order or contract.

As mentioned above it is a method of calculating cost of a particular job and takes into account the cost of materials, labor and overhead.

Process of Job Costing

1) Prepare a separate cost sheet for each job

2) Calculate cost of material issued for the job

3) Labor charges incurred

4) When job is completed, overhead charges are added for ascertaining total cost.

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