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Job order cost sheet Remnant Carpet Company sells and installs commercial carpeting for office buildings. Remnant Carpel 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 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 $9,450 to carpet the Consulting firm’s newly leased office. The estimate was based on the following data: Estimated direct materials: 200 sq. ft. at $35 per sq. ft.................................. $7,000 Estimated direct labor. 16 hours at $20 per hour.................................. 320 Estimated factory overhead (75% of direct labor cost).......... 240 Total estimated costs......................................... $7,560 Markup (2S% of production costs)............................. 1,890 Total estimate............................................... $9,450 On October 3, Jackson Consulting signed a purchase contract, and the delivery and installation was completed on October 10. The related materials requisitions and time tickets are summarized as follows: Materials Requisition No. Description Amount 112 140 sq. ft. at $35 $4,900 114 68 sq.ft.at $35 2380 Time Ticket No. Description Amount H10 10 hours at $20 $200 H11 10 hours at $20 200 Instructions 1. Complete that portion of the job order cost sheet that is prepared when the estimate is given to the customer. 2. Record the costs incurred and prepare a job order cost sheet. Comment on the reasons for the variances between actual costs and estimated costs. For this purpose, assume that the additional square feet of material used in the job were spoiled, the factory overhead rate has proven to be satisfactory, and an inexperienced employee performed the work.

BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094
BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094

Solutions

Chapter
Section
Chapter 19, Problem 19.3APR
Textbook Problem

Job order cost sheet

Remnant Carpet Company sells and installs commercial carpeting for office buildings. Remnant Carpel 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 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 $9,450 to carpet the Consulting firm’s newly leased office. The estimate was based on the following data:

Estimated direct materials:  
200 sq. ft. at $35 per sq. ft.................................. $7,000
Estimated direct labor.  
16 hours at $20 per hour.................................. 320
Estimated factory overhead (75% of direct labor cost).......... 240
Total estimated costs......................................... $7,560
Markup (2S% of production costs)............................. 1,890
Total estimate............................................... $9,450

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

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

Materials Requisition No. Description Amount
112 140 sq. ft. at $35 $4,900
114 68 sq.ft.at $35 2380
Time Ticket No. Description Amount
H10 10 hours at $20 $200
H11 10 hours at $20 200

Instructions

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

2. Record the costs incurred and prepare a job order cost sheet. Comment on the reasons for the variances between actual costs and estimated costs. For this purpose, assume that the additional square feet of material used in the job were spoiled, the factory overhead rate has proven to be satisfactory, and an inexperienced employee performed the work.

Expert Solution

(1)

To determine

Job cost sheet:

Job cost sheet is a document which is used to record manufacturing costs. It is prepared by the company which makes use of job costing system for computation and allocation of cost to products. It is a subsidiary ledger to work in process account as it contains all information about jobs.

To prepare: An estimate to be given in job cost sheet by Company RC.

Explanation of Solution

Prepare job order cost sheet for estimate as follows:

Expert Solution

(2)

To determine

To prepare: job order cost sheet by Company RC for actual cost incurred.

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Chapter 19 Solutions

Accounting
Show all chapter solutions
Ch. 19 - Issuance of materials On May 7, Bergan Company...Ch. 19 - Issuance of materials On August 4, Rothchild...Ch. 19 - Direct labor costs During May, Bergan Company...Ch. 19 - Direct labor costs During August, Rothchild...Ch. 19 - Factory overhead costs During May, Bergan Company...Ch. 19 - Factory overhead costs During August, Rothchild...Ch. 19 - Applying factory overhead Bergan Company estimates...Ch. 19 - Applying factory overhead Rothchild Company...Ch. 19 - Job costs At the end of May, Bergan Company had...Ch. 19 - Job costs At the end of August, Rothchild Company...Ch. 19 - Transactions in a job order cost system Five...Ch. 19 - Cost of materials issuances under the FIFO method...Ch. 19 - Entry for issuing materials Materials issued for...Ch. 19 - Entries for materials GenX Furnishings...Ch. 19 - Entry for factory labor costs A summary of the...Ch. 19 - Entry for factory labor costs The weekly time...Ch. 19 - Entries for direct labor and factory overhead...Ch. 19 - Factory overhead rates, entries and account...Ch. 19 - Predetermined factory overhead rate Street....Ch. 19 - Predetermined factory overhead rate Poehling...Ch. 19 - Entry for jobs completed; cost of unfinished jobs...Ch. 19 - Entries for factory costs and jobs completed Old...Ch. 19 - Financial statements of a manufacturing firm The...Ch. 19 - Decision making with job order costs Alvarez...Ch. 19 - Decision making with job order costs Raneri...Ch. 19 - Job order cost accounting for a Service company...Ch. 19 - Job order cost accounting for a service company...Ch. 19 - Entries for costs in a job order cost system...Ch. 19 - Entries and schedules for unfinished jobs and...Ch. 19 - Job order cost sheet Remnant Carpet Company sells...Ch. 19 - Analyzing manufacturing cost accounts Fire Rock...Ch. 19 - Flow of costs and income statement Ginocera Inc....Ch. 19 - Entries for costs in a job order cost system Royal...Ch. 19 - Entries and schedules for unfinished Jobs and...Ch. 19 - Job order cost sheet Stretch and Trim Carpet...Ch. 19 - Analyzing manufacturing cost accounts Clapton...Ch. 19 - Flow of costs and income statement Technology...Ch. 19 - Communication TAC Industries sells heavy equipment...Ch. 19 - Predetermined overhead rates As an assistant cost...Ch. 19 - Communication Carol Creedence, the plant manager...Ch. 19 - Job order decision making and rate deficiencies...Ch. 19 - Recording manufacturing costs Todd Lay just began...

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