Ch 5 Class Notes

Ch 5 Class Notes - Problem: We need to know cost before end...

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Job Order Cost 1. Single Homogenous Product Total Cost / # units produced = Cost / Unit 2. Cost of Non-homogenous products such as Ambulances - D.M. – Bill of Materials - D.L. – Hours worked by unit - M.O.H. – How do we allocate? 3. Typical Allocation Bases - Direct Labor Hours - Direct Labor Dollars - Machine Hours 4. M.O.H. Rate = Total M.O.H.____ Volume of Activity O.H. Allocated (Applied) = M.O.H. Rate X Unit Activity
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Total Cost = DM + DL + Applied O.H. Problem: Should ambulances mfg. in winter sell for more than those made in summer? Solution: Use O.H. Rate based on a year’s activity
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Unformatted text preview: Problem: We need to know cost before end of year Solution: Guess what the O.H. Rate is and use that C.E. 5-1 Problem: Total Applied O.H. not equal to Actual Solution: Include variance in CoGS C.E. 5-2 What if different departments overhead was best determined by different allocation bases? C.E. 5-3 What if we have departmental data but decide its more accurate or cost effective to use a plant-wide POR? C.E. 5-4 How do we keep track of cost of individual units or jobs? C.E. 5-5 Job Cost Sheets Subsidiary Ledgers to WIP, FG, CoGS...
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This note was uploaded on 10/20/2011 for the course ACC 222 taught by Professor Brewer during the Spring '08 term at Miami University.

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Ch 5 Class Notes - Problem: We need to know cost before end...

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