The following data relates to M/s. ZULFIQAR Co. for the month of August 2020 (who maintains Job Order Cost System). Data Material purchased on account Rs. 135,000 Material requisitioned and Factory Labour used Material Factory Labour Job No. 201 Rs. 15,000 Rs. 18,000 Job No. 202 Rs. 10,000 Rs. 12,000 Job No. 203 Rs. 22,800 Rs. 15,000 Job No. 204 Rs. 15,200 Rs. 12,000 For general factory use Rs. 5,000 Rs. 8,000 Factory overhead cost incurred on account Rs. 40,800 Depreciation of Machinery Rs. 10,000 The Factory overhead rate is 120 % of direct labour cost. Job completed: No. 201, 202 & 203. Job No. 201 and 203 were shipped and customers were billed for Rs. 104,000 & Rs. 105,000. Required: Cost of Jobs Completed Cost of Jobs Sold Profit of both Jobs Sold Factory Overhead
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.
The following data relates to M/s. ZULFIQAR Co. for the month of August 2020 (who maintains Job Order Cost System).
Data
- Material purchased on account Rs. 135,000
- Material requisitioned and Factory Labour used
Material Factory Labour
Job No. 201 Rs. 15,000 Rs. 18,000
Job No. 202 Rs. 10,000 Rs. 12,000
Job No. 203 Rs. 22,800 Rs. 15,000
Job No. 204 Rs. 15,200 Rs. 12,000
For general factory use Rs. 5,000 Rs. 8,000
Factory overhead cost incurred on account Rs. 40,800Depreciation of Machinery Rs. 10,000- The Factory overhead rate is 120 % of direct labour cost.
- Job completed: No. 201, 202 & 203.
- Job No. 201 and 203 were shipped and customers were billed for Rs. 104,000 & Rs. 105,000.
Required:
Cost of Jobs Sold
Profit of both Jobs Sold
Factory Overhead
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