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Job Order Costing
Job Order Costing
Module 6
Learning Objectives
After studying this chapter, you should be able to:
[4] Indicate how the predetermined overhead rate is determined and used.
2-1
Cost Accounting Systems
Illustration 2-1
Illustration 2-2
Illustration 2-3
2-13 LO 3
Job Order Cost Flow
Illustration 2-6
Assigning Raw
Materials Cost
The sum of the direct
materials columns of
the job cost sheets
should equal the direct
materials debited to
Work in Process
Inventory.
► Hours worked
Illustration 2-7
2-18 LO 3
Job Order Cost Flow
Illustration 2-8
2-19 LO 3
Job Order Cost Flow
2-20 LO 4 Indicate how the predetermined overhead rate is determined and used.
Job Order Cost Flow
► Machine hours
2-21 LO 4 Indicate how the predetermined overhead rate is determined and used.
Job Order Cost Flow
2-22 LO 4 Indicate how the predetermined overhead rate is determined and used.
Job Order Cost Flow
2-23 LO 4 Indicate how the predetermined overhead rate is determined and used.
Job Order Cost Flow
This means that for every dollar of direct labor, Wallace will
assign 80 cents of manufacturing overhead to a job.
_______
2-24 LO 4 Indicate how the predetermined overhead rate is determined and used.
Job Order Cost Flow
2-25 LO 4 Indicate how the predetermined overhead rate is determined and used.
Job Order Cost Flow
Illustration 2-11
Manufacturing
Overhead
Costs
The sum of the
manufacturing
overhead columns of
the job cost sheets
should equal the
manufacturing
overhead debited
(i.e., applied) to Work
in Process Inventory.
2-26 LO 4
Job Order Cost Flow
Illustration 2-12
2-27 LO 4 Indicate how the predetermined overhead rate is determined and used.
Job Order Cost Flow
When a job is
completed, the
costs are
summarized
and the job
cost sheet is
completed.
2-28 LO 5
Job Order Cost Flow
2-29
LO 5
Job Order Cost Flow
Summary
Illustration 2-16
Review Question
Manufacturing overhead is underapplied if:
a. Actual overhead is less than applied.
b. Actual overhead is greater than applied.
c. The predetermined rate equals the actual rate.
d. Actual overhead equals applied overhead.