A job costing l job costing b process costing m

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costing.costing.a.Job costingl.Job costingb.Process costingm. Process costingc.Job costingn.Job costingd.Process costingo.Job costinge.Job costingp.Job costingf.Process costingq.Job costingg.Job costingr.Process costingh.Job costing (but some process costing)s.Job costingi.Process costingt.Process costingj.Process costingu.Job costingk.Job costing4-174-174-17(20 min.)ActualActualActualcosting,costing,costing,normalnormalnormalcosting,costing,costing,accountingaccountingaccountingforforformanufacturingmanufacturingmanufacturingoverhead.overhead.overhead.1.=Budgeted manufacturingoverhead ratecostslabor ingmanufacturdirect BudgetedcostsoverheadingmanufacturBudgeted== 1.80 or 185%$2,700,000$1,500,000=rateoverheadingmanufacturctualAcostslabor ingmanufacturdirect ActualcostsoverheadingmanufacturActual== 1.9 or 190%$2,755,000$1,450,0002.Costs of Job 626 under actual and normal costing follow:ActualActualActualNormalNormalNormalCostingCostingCostingCostingCostingCostingDirect materials$ 40,000$ 40,000Direct manufacturing labor costs30,00030,000Manufacturing overhead costs$30,0001.90; $30,0001.8057,00054,000Total manufacturing costs of Job 626$127,000$124,000
4-43.=Total manufacturing overheadallocated under normal costingActual manufacturinglabor costsBudgetedoverhead rate=$1,450,0001.80=$2,610,000=Underallocated manufacturingoverheadActual manufacturingoverhead costsManufacturingoverhead allocated=$2,755,000$2,610,000 = $145,000There is no under- or overallocated overhead under actual costing because overhead isallocated under actual costing by multiplying actual manufacturing labor costs and the actualmanufacturing overhead rate. This, of course equals the actual manufacturing overhead costs. Allactual overhead costs are allocated to products. Hence, there is no under- or overallocateadoverhead.4-184-184-18(20 -30 min.)JobJobJobcosting,costing,costing,normalnormalnormalandandandactualactualactualcosting.costing.costing.1.==Budgeted indirect-cost rateBudgeted indirect costsBudgeted direct labor-hourshours160,000$8,000,000=$50 per direct labor-hour==Actual indirect-cost rateActual indirect costsActual direct labor-hourshours164,000$6,888,000=$42 per direct labor-hourThese rates differ because both the numerator and the denominator in the two calculations aredifferent—one based on budgeted numbers and the other based on actual numbers.2a.LagunaLagunaLagunaModelModelModelMissionMissionMissionModelModelModelNormal costingDirect costsDirect materialsDirect laborIndirect costsAssembly support ($50900; $501,010)Total costs$106,45036,276142,72645,000$187,726$127,60441,410169,01450,500$219,514
4-53.Normal costing enables Anderson to report a job cost as soon as the job is completed,assuming that both the direct materials and direct labor costs are known at the time of use. Oncethe 900 direct labor-hours are known for the Laguna Model (June 2007), Anderson can computethe $187,726 cost figure using normal costing. Anderson can use this information to manage thecosts of the Laguna Model job as well as to bid on similar jobs later in the year. In contrast,Anderson has to wait until the December 2007 year-end to compute the $180,526 cost of theLaguna Model using actual costing.Althoughnotrequired,thefollowingoverviewdiagramsummarizesAndersonConstruction’s job-costing system.INDIRECTCOSTPOOLCOSTALLOCATIONBASEDirectMaterialsCOST OBJECT:RESIDENTIALHOMEDIRECTCOSTSDirectManufacturingLaborIndirect CostsDirect CostsAssemblySupportDirectLabor-Hours2b.

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