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,
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.
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
| 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.
A job order cost sheet accumulates the costs charged toa specific job. The information contained within the cost sheet includes the job number, start and stop dates, the number of units produced, all direct materials and direct labor costs associated with a job, and a factory overhead allocation.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
