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    Assignment # 1: Cost Classification

    Uploaded by

    Rosenba Dela
    This document contains information about cost classification and costing systems for K&J Bakery. It presents a table classifying various costs as fixed, variable, direct, indirect and the relevant costing periods. It recommends job order costing as the most suitable system for K&J Bakery given its production process. It also explains why process costing and activity-based costing would not be applicable. Several transactions are presented in T-account format including raw material purchases, salaries paid, sales revenue and cost of goods manufactured. An income statement and break-even analysis are also included.

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    Assignment # 1: Cost Classification

    Uploaded by

    Rosenba Dela
    45 views7 pages
    This document contains information about cost classification and costing systems for K&J Bakery. It presents a table classifying various costs as fixed, variable, direct, indirect and the relevant costing periods. It recommends job order costing as the most suitable system for K&J Bakery given its production process. It also explains why process costing and activity-based costing would not be applicable. Several transactions are presented in T-account format including raw material purchases, salaries paid, sales revenue and cost of goods manufactured. An income statement and break-even analysis are also included.

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    Table

    Original Title

    Nima

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    This document contains information about cost classification and costing systems for K&J Bakery. It presents a table classifying various costs as fixed, variable, direct, indirect and the relevant costing periods. It recommends job order costing as the most suitable system for K&J Bakery given its production process. It also explains why process costing and activity-based costing would not be applicable. Several transactions are presented in T-account format including raw material purchases, salaries paid, sales revenue and cost of goods manufactured. An income statement and break-even analysis are also included.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    45 views7 pages

    Assignment # 1: Cost Classification

    Uploaded by

    Rosenba Dela
    This document contains information about cost classification and costing systems for K&J Bakery. It presents a table classifying various costs as fixed, variable, direct, indirect and the relevant costing periods. It recommends job order costing as the most suitable system for K&J Bakery given its production process. It also explains why process costing and activity-based costing would not be applicable. Several transactions are presented in T-account format including raw material purchases, salaries paid, sales revenue and cost of goods manufactured. An income statement and break-even analysis are also included.

    Copyright:

    © All Rights Reserved
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    of 7

    Assignment # 1

    Cost Classification
    Oven
    Cash Register
    Baking Pans
    Business
    License
    Health
    Inspector
    Rent
    Utilities
    Mobile Phone
    Flour
    Sugar
    Baking Soda
    Butter
    Raisons
    Eggs
    Rum
    Others
    Accountant
    Brianna Salary
    Alexis Salary
    Keisha Salary
    Aunt Ellen
    Salary

    Fixed Variable Direct Indirect Product DM DL MOH Period


    X
    X
    X
    X
    X
    X
    X
    X
    X
    X
    X
    X

    X
    X
    X

    X
    X
    X

    X
    X

    X
    X

    X
    X
    X
    X
    X
    X
    X
    X

    X
    X
    X
    X
    X
    X
    X

    X
    X
    X
    X
    X
    X
    X
    X

    X
    X
    X
    X
    X
    X
    X

    X
    X
    X

    X
    X

    X
    X

    X
    X
    X

    Assignment # 2

    Costing System
    K & J Bakery inc. is concentrating on specific job orders & serving a specific group of
    customers. So the bakery should focus on job order costing system & they are doing that. The
    cost flow of the bakery should process on direct cost and indirect cost which can be easily
    viewed and assigned to individual units being produced in a time period.
    Process costing is not effective for the company as process costing is typically used for
    companies that continuously produce a vast unit of product.
    Activity based costing is also not applicable because it is used as an addition to other costing
    system in any process unit.

    Assignment # 3

    Business Transactions (T Accounts)

    Raw Material
    Beginning Inventory
    Flour
    Eggs (67*2)
    Raisins {(4/2)*100}
    Butter {(4/6.5)*200}
    Sugar {(15/25)*200}
    Baking soda (6*20)
    Other materials
    Rum (12*50)

    0
    600
    134
    400
    325
    120
    120
    30
    600

    Direct
    Indirect

    2,329

    2,209
    120

    2,329

    Salaries Payable
    Beginning Inventory
    Accountants
    Keisha Salary
    Aunt Ellen Salary
    Alex Brianna

    0
    100
    1,500
    100
    2,400

    Cash

    3,100

    3,100

    3,100

    Accounts Payable
    Beginning Inventory
    Ending Inventory

    0
    2,271
    2,271

    Material
    Phone
    Cash Register

    2,209
    50
    12
    2,271

    Sales
    Beginning Inventory
    Cake

    0
    10,000

    Cash

    10,000

    10,000

    10,000

    Manufacturing Overhead (MOH)


    Beginning Inventory
    Rent
    Utilities
    Depreciation
    Aunt Salary
    Baking Soda
    Other

    0
    600
    50
    100
    100
    120
    30

    Ending Inventory

    1,000

    1,000

    1,000

    Account Depreciation
    Beginning Inventory
    Ending Inventory

    0
    100

    Depreciation

    100

    100

    100

    Work-in Progress
    Beginning Inventory
    Direct Material
    Direct Labor
    Manufacturing Overhead

    0
    2,209
    2,400
    800
    5,409

    Ending Inventory

    5,409

    5,409

    Finished Goods
    Beginning Inventory
    Work-in-progress

    0
    5,409

    Ending Inventory

    5,409

    5,409

    5,409

    Expenses Account
    Beginning Inventory
    Keisha Salary
    Accountant
    Phone
    Cash Register

    0
    500
    100
    50
    12

    Ending Inventory

    662

    Cost of goods sold


    Goods Sold
    Under Applied

    5,409
    200

    Ending Inventory

    5,609

    662

    662

    Assignment # 4

    Cost of Goods Manufactured

    Direct Material
    Direct Labor
    Manufacturing Overhead

    2,209
    2,400
    800

    Cost of Goods Manufactured

    5,409

    Income Statement for Month January

    Sales
    Cogs

    10,000
    (5,409)
    4,591

    Less: Variable & Fixed Expense


    Cash Register
    Salary Expenses
    Phone Expenses
    Depreciation Expenses

    12
    500
    50
    100
    (662)

    Income Expenses

    3,929

    Assignment # 5

    Break Even Analysis/ Target Sales


    Sales
    (-) Variable Cost

    10,000
    (4729)

    Units
    50
    (23.64)

    Contribution Margin
    Less: Fixed Cost

    5271
    (1512)

    26.36
    (7.56)

    3759

    18.80

    Contribution Margin
    Breakeven in Unit Sales
    Breakeven in Dollars
    Target Sales in units
    Target sales in Dollars

    =
    =
    =
    =
    =

    26.36/50
    1512/26.36
    1512/0.5272
    (500+1512)/26.36
    (500+1512)/0.5272

    =
    =
    =
    =
    =

    0.5272
    57.36
    2867.98
    76.33
    3816.39

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