ACIS 2116 Chapter 5 Powerpoints Part 2 Spring 2009

ACIS 2116 Chapter 5 Powerpoints Part 2 Spring 2009 - Job...

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ACIS 2116 Chapter Five – Part 2 Job Costing, Process Costing and Operations Costing
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Comparing Job and Process Costing Finished Goods Cost of Goods Sold Direct Labor Manufacturing Overhead Jobs Costs are traced and applied to individual jobs in a job costing system. Direct Materials
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Comparing Job and Process Costing Finished Goods Cost of Goods Sold Direct Labor Manufacturing Overhead Processing Department Costs are traced and applied to departments in a process costing system. Direct Materials
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What is a Processing Department? Any location in an organization where materials, labor or overhead are added to the product.
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T-Account View of Cost Flows For purposes of this example, assume there are two processing departments – Departments A and B. We will use T- accounts.
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Process Cost Flows (in T-account form) Work in Process Department B Work in Process Department A Raw Materials Direct Materials Direct Materials Wages Payable Direct Labor Direct Labor Mftg. Overhead Applied Overhead Actual Overhead Applied Overhead Transferred to Department B Transferred From Department A
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Finished Goods Cost of Goods Sold Process Cost Flows (in T-account form) Work in Process Department B Transferred from Dept. A Cost of Goods Sold Cost of Goods Sold Direct Materials Direct Labor Applied Overhead Cost of Goods Manufactured Cost of Goods Manufactured
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Process Costing Example Hokie Brick Company produces bricks in two processing departments-Molding and Firing. Hokie bases the predetermined overhead rate on machine hours. Total estimated machine hours
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ACIS 2116 Chapter 5 Powerpoints Part 2 Spring 2009 - Job...

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