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    Ae27-Chap 9

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    Yza Gesmundo

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    © All Rights Reserved
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    unting. jow of costs in @ merchandising jufacturing company, ish between the job order “plocess costing system and coder costing system in a pany anda service enterprise CHAPTER 9 a 4 SYSTEMS DESIGN: JOB-ORDER COSTING AND PROCESS COSTING Introduction to Cost Accounting and Management Accounting ‘Accounting systems serve people both inside and outside an rgsnization. ‘The diferent needs of estomal and internal users require different approaches @ cpcrting tformation. Chapter | oulined the differences between financial ‘Soourting, whith s primarily conserned with external reporting and managerial seeRtntng which is primarily consemed with intemal reporting. Although the the benches die in thei objectives they share a common daa base as well as Some basic concepts. Cost accounting isthe subfield of accounting records, measures, and reports ation about costs When costs afe used inside the organization by managers to evalate the performanee of operations or persomel, or 25a Basis for devcion making, we say cons ae used fr manager tal accounting Purses, ‘Wher costs are used by outsider, suchas shareholders o eedios, o evalua the perfomance of top management and make investment decisions about the toreaization we say costar sed for fxareial accounting purpeses. = low of Costs in a Merchandising Company { ercanng ampais such compres parent toes, rues eee hese te mettmndse ey sll to csomer, Th Feet ae ae de pease ps ofthe mechs When poets a a ee ee da ws eat or Oe sero oe a ver and Merchandise tment. Ths sect nlc al guds Porcated fr reals that ete esl, coss re removed fom the Sateen of mci ston and caged apt sles eens te Suument Selig and edmnstatve cass ate cued ao weit “erating capes for he pv thence atone. Figure eb ow ofcoss nmercunsing emer. ‘out and pled nthe Workin Process sso. The Sri on hand i ser scout at psd en wl apa ‘ope count ote Semen of nelson Br cons are recorded 25 they are ferotbe sored for use ine lanes so Bite css placed inthe Work in Progen scount, Manufacturing overhead fepreciation charges, use of indie = one ming pl pd use oF expiration of other Foprtions. The manufacturing overheag ulated Depreciation, Prepaid insu fof financial position. ln the lasation (Overhead Accounts st a these Proved from the factory to he storeroom, liter labor, and manvfectring evap Bunt the Finished Goods account. Faaly, otal eos is transferred from the Finished job order, process costing oF operatin accountants are ouired fo mate fat #5 standard costs? Historical cos Slandard costs are esate of what 3 fand engineering estimates. The 96 cal cost. Ora process cost accountng stem? fen whether the product Labsrption o drct costing of fixed manfctring ovrbesd i absorption costing is od ost ater hana inventory ne in tot a Job Onder Costing amd Process Couting 49 4. What stem vill be used to assign ovthed Cass alt pany se plantwide or actvi-based predetermined ovehesd ae? Wiatand how many cost diver shold be wae? Cos accounting systems can vary grey depending on these decisions Fer ample standard procest costing system might be Based on fll shaopon ‘ing anda plntwie overhead rate A standard jo onder costing sem night be Basel on direct costing and « dopants Oreo fl Sia JOB ORDER COSTING SYSTEM With a jb order cost system, cost te assigned each jo A jo my Bea seo unto padoction, oa bah perfomed © met cose? Tieavons. For example when rearing a television se, an eletcan wes “ostng to accumulate the outs of the reps jo, The eleaican sth cost of repr pare andthe diet Ihor- hous pen in repating the st Ovethead costs are applid sing an overhead fate Accountant 6 onder costing nthe sonstrcton of commercial nd sient baling ‘hips and mashites. Far example, 2 prising company wes job onder esting Bednse primers, usally prodice “each patting der 19 Susman Specifications Tob onder costing appropriate fer companies making different Systems Desig: Job-Order Costing nd Process Contin 351 Figure 95. Flow of Costs in Job-order Costing Summary of Accounting Procedures using Job Order Costing f 2 Manufacturing Company he prchase an issue of materia with ural ens To reonl the pure of materials the scountant increases both the Siac nvewory (dl and Accounts Payable (ef) aout, To record the hu oft material, te ascountat reduces te Materials Inventor (@) ‘Sunland eens the Work in Process Inventory () acount by the inountsbowa on the materials reqistion fomm. To cod the rhe of vlc meter the accountant reduces the Materials, Inventory (6) ‘count and inseaes the Asta Manfatring Overhead (dt) asoun Resor abr cot wit joumal ents. To record the incurence of direct lor cots, the accoantantinreass the ‘Work in Proce Inventory (8) and Wages Payable (cr) account by ft iret aborcos on jo. Thiol i clelted ffom worker” Ucar Indirect labor is recorded as an increase 19 the Actal ‘vend (8 account ad an eras to Wages Payable (2) ‘Clealae a predetermined ovrhed mate and use it sin twaje ety a I tha beet ordi tg gall 4 drate. The predetermined ie a pas are common cos ‘overhead costs incur hey must be assigned ac. "iy head a © year ordi t om ovethed came measured by fing overhead costs with journal entries, fe secountant increases the Work in Prey Manufacturing Overcas! (r) accounts Oy ie fe tojobs, using the predetermined overhead ae fault the average cos: per unit of jek [BE iret labor, and spplid ovetead is | When a job is complcted.chese coms a itis determined by dividing the total eatel Et) bythe numberof gos units produced costs with journal entries. a cass, the accoontant adds ee Greed (acount. Aca ove I and indirect abor as well as and utilities. Thus, expired the Prepaid Insurance account if {Overhead account. Factory mri Depreciation account; uilitis 6% fan average sunt aco moth nal or regular pate ge To fiom applied evcred i tra actual overhead " Stems Dest: Job-Onder Costing and Process Costing _ 353 \When appli overbead is greater than actual manufacturing overhead, the overhead is refered to as overapplied, When applied ovethead i es thn actual manufacturing overead. the ovehead undraplid. Ove ar tunderaplid overhead cose ae usually subtracted fom or added tthe cost of ened sold on the monthly income semen hed my be over or undeapli at mon end beaase of seasonal variations in actal ovethead cos an inegular OecuTenoe of actual Ovethead cost, semondl variations. in praduction volume, oF naccurate estimates of total manufacturing overead Or otal production Although the fs chee causes will produce differences fetwoen atl and applied overhead on a momhiy basis. by yearend the difrenes will, © ut. No corective act needed,” The lst cause faulty estates an al ‘over o underapplid Overhead at year a Well a tend. the eiferences are lng, the predtermined overhead rate Calculate cortof goods manufactred and cost of goods sold ‘You find the cost of goods competed during the moth, called the cost soos manufactured, by aalying stv inthe Work Poses nvemny count over te past month. The process For preparing the atement and ‘alculating cost of goods manufactured is as Follows Direct Materials Used Dire iabor + Applied Manufacturing Ovethead = Total Manufacturing Coss Beginning Balance, Work in Pres Inventory Ending Balance, Work in Prog Invenio =~ Cost of Goode Manufitured ‘The cos of goods manufetred is usd in preparing the statement of cost of pods sold! Cost of goods manufactured can also be calculated by Summarizing te costo al job completed duting the period {old ean be considered a an Preparing a statement of oon ox of ae be clus by oping the un Eeaisenien the job con snc cana the inte teen jCorting fn 9 Mans facturing Company firm that uses job-order costing, Qh fal year, the company’s inventory bane fo jobs of the b ented tnt would wor elise in. producion, PAM $P200000 det eters) aed for employe sevice Sad systems Design: Job-Onder Costing and Process Casting 355, fh Insurance expited ding the year, P100,000 (70% relates 10 facto fpuation, ond the ermaining 30% relates to seling and adminiseatve sctviti. i. Manufectring ovethesd was applied to production. Due to gente tun Crpeted demand forts produ, the company worked 800,000 machine hours during the ea. j: Goods costing 9,000,000 to manuficue according o tei job cost sheets were completed during the year 1 Goods were sold on secount fo castomers dering the year at total sling prise of 15,000,000 The goods cot P, 700,000 to manufacture according to theijob cost sheets 1 Prepare journal xs to end the preceding tansctions 2 os the eatries in (1) above to T-sezoums (Gout forget 1 ener the tetioning balances inthe inventory account) 5, 1s Manufacturing Overhead anderpplied or overapplied for the year? ‘jr eit p close any lane inthe Manufactring Overbead sccout fo Cost of Goods Sold. Do ot allocate the balance between ending enfoisand Cost of Goods Sold 4. Prepare an income statement forthe yr Patmera Company Raw Mari “4100900 Ato Faye 4.100000 Work Proce. 3.600000 ancttaring veel ‘o.900 "tw Mera 5.300000 Work in Proc 130000 Nrtacurag Ove 1an000 Sse Commision Emo ‘0.003 Admins Saas Expense 000000 ‘Strand Wages Pyle 5000 A Sls Tvel Epes 1r9000 ‘acon Paabe cig 79000 ee "acta Pape 45000 Aves spent ‘ascot Pate Te crab co 9 osscon pa a80900. Te Foowing ‘4100000 2000.00 ‘smo 700000 4700000 mam |G oa fy asoan ice ‘stems Design: Ja Order Casing and Process Costing 351 eee ee aa ET a eae |e A "0 2 non “om fo oan 8 sine icemasous i) 200m ‘ ae — te | a Po ‘wi za Tes nea Sy poe urns pe aia | aa ee ae orton past _ Sen Tl pm 7 eT w ; aulcurng orten! is overlie fr te yee. The my 10 one cat 9 Cat Mantcing ved. 20.900 "Conf Cond Sa. 20.900 sate is c00000| 1a oda 700 000 P200.009.—— erect ros man 2 6500.00 Sy eting ada pS Conmision ere ‘anise ra pest bent epee ‘wenn ees Sie gee et operaig em a » 00000 60 00 Iestrative Problem 92. Comprehensive Problem Stetng Milwork, Li, produces reproductions of antique riot weep ocd in indang, Cavite Since thee are hundrds of rie are made only fo ode, the company use a jobarder costing Djs vation, secount balances Pro.000 ‘4000 8000 E200 on the Basis of machine how us ie Pitipinss and cic thatthe pant wo ia marafictring ovr. Mo jobs the remains crate 11,000 (13,000 of his amount Premsinder rested 0 scline and ___ ston ese: Jo Onder Casting and Process Covina 359) |. Sales (ll on acount) customers during ihe year aed 898,000, These ots had cost POD, 000 manufacture according te thirjb ost shes ds Sold. Post least wr oun entries to reson the ranean fr the yer uns for mventones, Manufacturing Overbead, and Cost of "rom your ual envies to these accounts forget tent the opening Balanges In your fevesiory sezouns) anlsctriog, Overhead anderappied or overaplied for the year? pa jour xt to close any balance inthe Manufacturing Ovthead tt Cant of Goods So Steen! or tb year (Do prepare a schedule fost 1 manufactured, ll of the irmation needed for the Income vent is valle a the otal enies and Taccouis you have Sterling Millwork, Lad Sas Expr. ee ‘Stas nd Wages Ppabie aatcring Overhead, oe Insane Expense Prep sn 2 Manutactring Oven = ‘cou Pyale 7000 B00 ws = Pring overeat spies 210.000 98000 atoms Design: Jo Order Costing and Process Coting 36 STERLING MILLWORK, LTD. Forte Veo Ended Je 30 sr ot of god sl (508,00 + 1,00, Ieuan expe 5.00 ever renee. 15000 Depeltinexense "S00 9500 Net peting come ‘Eaam Iusteative Problem 93. Job Order Costing ina Service Company River & Assocate isa lw frm specaizing i labor ations and employee ‘ised week it employs 25 professionals (5 parers and 20 associates) who. Crk citey wih ts chet The average Bugeted tial compensiion pet ‘rfc! for 2018 i PLO$,000. Each professionals budgeted to have 1,600 isbie hours to cheats in 2018. River is highly respected fm, and all protcsionals wodk for ele to their maximum 100 billable hows waiale Jit profavonl labor cots rence in single dectos calgary d ae ‘raced to jobs ona perchour basis Allcosts of Rivera & Associates other than professional lor costs ar included faa tingle indetcost pool (lea oppor?) and ae allocated 0 jbs wing profesional bor hous asthe allocation base, The budgeted level of indiet ests 2018 P22 lon Requinen: [Present an overview diagram of River's job-costng system. ‘Compute the 2018 budgeted professional labor-how ditet-sost ae. ‘Compute the 2018 budgeted inirectcost ate per hou of professional labo Rivera Associates i conidring bidding ot jobs: TLgation work for Santos Trading, ne, that requires 100 ars of profesional labor [bor contract work for Reyes Manufacturing Co» that bdpeted hers of professional labor 2 2 est bor serensabon Pudge oa direct bor hours Peper pfesional hor 11 (Budgeted som cosines pan (Bolgeted al profesional hor hous Systems Desig: Job-Order Costing and Process PROCESS COSTING SYSTEM Concept and Applicat Using process casting system, accountants accumulate cost for each fheyarment for & time period and alloeate them among. all the prods Imanufactured during the peioé. They use process costing in fee eam sing. petoleum refining, and other industries where here is # continuous reduction roves. Diret material, direct labor ad applied factory overhead [re-accumulated foreach department fora period, usualy & month. AL the end tthe poriod, departmental eos is divided bythe number of units produced to cvain scout per anit Figure 96 shows the ow of costs in a Process Casting System Figure 97 shows the T-xccount Model of Process Costing lows cy Figure 9.6, Flow of Costs- Process Costing Sytem Dyess J —— process cost Systm, Drecitabor | —~ | Preaas enfachnng ‘Overhead are produced continuously, tat i Stating. and stopping points in He method, you accumulate costs 8 ty atthe end ofa specifi time ealeaated by dividing activity 5 ‘Systoms Design: Job Order Costing and Process Costing 368, ‘A cost summary summarizes costs and wis fora activity when process using is used I is a usta (col, expecially when computations ae ‘Somplex sh as when pally competed units must be accounted fo, Prepare journal entries to ecrd manufacturing costs and transfers. The journal entes wed to tanfer cost beoween ative in proses Lnting are basally the same a those used n job order coating The way Sou calculate the uit cost neded to make the oural entries, however, s iterent Jourl entics transfer separate costs from one production weit 10 co Finished Goods Inventory. Other oural ene are required 12 Ei dices meters cous, diet labor cox abd pli’ manufacturing overhed o each production activity Calculate equivalent unis when sources ar added uniformly Parially completed units ae oft in inventor at th end ofa period, Sine Some of the period's production costs belong to those parally completed its, thir eet mast Be calculated according to equivalent unis ater tan phil unis Prior department costae rarely aed uniformly, Instead, they ar added at atof the process Conversion 60S, however, ae lost always aed Cfonmly Ag det materials are usualy aed ina lump at some pint in te prodetion process, Bot re sometimes added uniformly, as i « mixing process, When resources are added uniformly throughout the production process, equivalent units are found by estimating. the percentage of ompition or effort put nto the partly competed units. That pereenage is then multiplied by the nimber of physical units, Sine dre materials ‘costs prot deparmen! cos, and conversion costs may differ in their percentage of completion, eqivlen units must be calculated separtely for ach cost elegy lout equivalent units when resources ae added in amp mp athe star, equivalent units fede is Tum atthe end fis equal the number of une ai cost fr ll types of costs and Fests to analyze the Mow of piysical units Pa burdingram. Next, equivalent units most This done by mukilyng the suber (heampletion in etch category. The Mparod and completed and for nding frthe FIFO cost flow assumption Invealory ar treaied diferenly ner Poth Cost perunt is fund by dividing the P/ By equivalent nis for thar catspory g aerage has partially completed unis on nd ofthe month, the costs ofthe becinning Imonth’s production cost. This fs the cos of goods transfered to in process. and use it to compute the c of beginning work in process are peurent month's cos and equivalent ry. The unit cose are sed work in process and (2) the the month, Finally, unit costs ae completed work in process st month Iusrative Problem 94. Process Cost Flows and Reports ‘Walla Home Print Company produces exterior latex punt, which it sellin nelly containers. The company has two processing. departments Frocersing and Finishing. White pant, which is ed as a base for all the Companys pain, is mixed from rw ingens in the Processing Deparment Froments are thon aed tothe basic white pit, the pigmented pats squirted finder pressure into one-galln containers, and the containers are labeled and pocked Tor shipping in the Finishing Deparment. Tnformation relating to the Sripany"s operations for Apri follows: Raw material were ise for use i production: Processing Deparment, 45,10; sod Finishing Departmen, P62, 900. b. Direct labor cons were incurred Processing Deparment, P3300; and Finishing Departmen, 27,000, Manufactring overhead cost was applied: Procesing Deparment, 6,500; and Finishing Departmen, P4500. 4. Bisic white paint was transfered fom the Processing Department 10 the Finishing Department, PI8S 000, Punt that had been prepared for shiping was transferred from the Finishing Department io Fiaished Goods, P320,00, Prepare journal entries to recon items (through (e) above. Post the journal ens ffom (1) above t T-ascoumts, The balance i the Processing Departments Work in Process account on Api 1 ws PIS,000; the balance in the Finishing Departments Work in Process account Was 7,000. After posting entries tothe Taccouns, Sind the ending balance in ech department's Workin Press account. 5. Prepare a production report forthe Processing Department for April. The Following additional information is avaiable regarding production inthe Processing Deparment ring April Froduction dt: Unis illo in roses, pei 1: mtr 100% complete, Tabor and overhead 61% compe. ‘Unit glen) stated io rodcin during Ai Unite (alls completed and ransfleed fo the Fnshing Dearne. WALLQUARD HOME PAINT COMPANY. Presson Report - ocean Depart orth Mout Ended Apr" oni Se ont in Sele pode 200 holsettenamomediee Sand fan i Tian aber Owed nn won pots A SSoranvchea oa a _____ tes Desig: Jb Order Contin Process Casting 311 equine: pe eccmpute the equivalent units for Ostber, assuming that the company ws the meighted- average method of scouting for units tnd cos ‘Compute the equivalent uns of prodoctan for Octobe, suming dat he ompany use the FIFO method of counting (or nits and oss an a 2 Ga en ssn Pea P3510 Yr0.20 Solution: Cassia Company i. sce 1. Weighed Average Meh Many F050 = 7180 — ae is eon or ws se Ba Comeriar Batt ss aon nis ester to Deparment. am Beers Later Ovchod ie eet ae oe 3900 unt same Bon 0 qari an of edion aie tom FiO Meiod * 20m nis tte acon fra lows : pint Teta Comerion Workin pocens Ocobe EUs; or and ovrhen: 8,000 ents # a0 ne He 000 Smt wis 4c ome sound comple dig Osobe* 360080 360000 ‘Watkin pose, Owe 3 : Applications of Process Costing 3008 os 2.0 ; i as ges through tree departments A Yim department A during October Perce Compete ‘rh Mates + Wark edd compete ee wits 1 410,00 = 0,000 360.00, - = Stems Design, Job-OnderCouting ond Process ai| 3 i | | Systems Choice: Job Costing versus Process Costing ; In Job costing, costar colle for ech wit pradiced._In proses costing. ie ‘costs are accumulated in & department for an accounting period (or example, ‘Sou ten spread evenly or averaged. ver all uns produced that month Prove costing essumes each unit produced irrelativelyutifrm, process costing has less deed resordkeeping: hence, if « company was Soosing. between job and process easing, t would generally find th ‘cordheping costs are loner under proces cosing_ OF course process costing "Tour not provide s much information ajo costing Beause records ofthe os. ‘teach unit produced are not Kept ing proces costing, The ehaie of poses conus jb costing systems fvolses «comparion of he costs and Benefits of ‘Asa general rule, job systems ae usally more costly than process sytem Tin, mange's and accounts mst decide whether ther. ars enoue “uu! benefits (for example, Fo beter decisions) fom knowing the se isto ech uit which avaiable fn jb costing system, to justify atonal ‘ccorhecping costs For companies procing relatively lars, heterogeneous fons iheaddiuonl benefits of job coring wstally Justify the addtional recoreeping cots al Ierscordhesping costs were equal under job ad process systems fr the unis in 1 product Te them the job stems are Bear Seeuse they prove all of he ‘ata tat proces stems do, pls Moe. Operation Costing Concept and Application tach company develops is om eels" Mary companies employ a Imanlactre of gods that BNE son i curren em a ee {Conia or ap tha epee sits we tare of prod sucha Sle A Ines sits nd Sle B ais ‘kumple, varius spe of aes! sis reir fen abe nd pee cs as ly allocate direct material othe Mest labor and ovcrhesd ae towing. They apply conversion Fopeton by sing single everape eating best meet the neade af fave varnfions of single Jesign and operations. ome ofthe aberder costing. For example, opration specifiy to the batches. This is labor and Oveead to ll physicl unas Iaingl erage unit conversion cos for costing Imanufacturing goods that have some Characeristes, Operation costing Ivhoge products have variations of a [uctee of sundardized operations. Job ive fr accumulating the cost of contracts the trend is toward proces costing designed sich as operation costing Questions Systane Design: lb-Order Costing and Process REVIEW QUESTIONS AND PROBLEMS. ‘When would job-order corting be wed in preference Yo proces oxi? Whats the prpoi ofthe job coset in jb-order costing ten? Explain why some production costs must be asiged Jo products through an allocation process Name several such eos. Would sch ‘oss be clasied as dct fas indies os? Wy do firms use predetermined overhead rates rater than sei rnufacring verted costs aplying vetead i units of predic hat factors shoul! be considered i sling a base 1 Be wed puting te predetermined veread a? ‘Under what conditions would ibe appropri to se proses costing Cots ae scumlted by job in jb-oree costing stem: how are Scots sccunlated ina proces costing ten? What wo ese festurescbracterz ny processing depanment i proves coating ten? ‘ny is cost accumulation eal under process coating system thant Ibunderajob-ordr costing system? Wha ia quantity sched and what porpose des tere? ‘Why aren't actual overhead costs aod 1 jobs just sds ais and ist aber east ae traced jobs? 1 company filly allocates al of ts overhead com 108 unrantr that a roi wl be eared forthe period? tn what ways aeob-rde and proces costing imi? ‘Wate, Ine, sive, and gol. The 2a in te manufac. What costing system fa varey of costs that vary greatly with ‘What isthe best way 10 choose an applying factory overhead? Fins switching from direct labor hous Job Order Costing) jn teh ofthe following stations -jb- Re Stes Design: Job Onder Costing and Proven: Contng 377 Predetermined overhead rates ae computed using the following Bases in the thre companies Ovra RaeBaed on Ban era cot —— 1 Compute he predetermined overhead rat tobe used in each company 2 Assume tht Company X works on te jobs doing the upcoming Yeas Direct aborhour recorded by jab ate Job 237, 7.00 hour: job 238 50.000 hours: a ob 239, 21,000 hows. How much overhead cot wil the company apply #0 Wark n Process fr the Year? factual oss ae 220,000 fore year, wil eveead be underapplied or overapplid? By how much? src 3 (Departmental Overhead Rates) ‘obest Company has tao deparment, milingand assy. The company tse job-rder eos stem and computes a predetermined overhead ain ‘Eh periment The milling department bases its ate on machined rn the assembly parmeat bass Hs ete on direct lnbor cos. A the ‘rinning ofthe year the company made the Flowing estimates gq hte Wiig Aen Diet bores ‘2000 “75000 chine ou ete Soon Manfetring oven ast PSIN000 460,000 Diet bec 720m "610000 Required |. Compute the predetermined oeread rat to be used in each Sparen 2} {lume thatthe oveead rates yu computed in (1) above ae i fhe ob cont shet for job 123, whch was sed and competed the ean showed the flowing: wl Diet be he Nate bate ‘Narra nom . opad b 13. Swe Di: Joh rd Ci nd Pres Cag 3B | i a q : ‘The toximing akin rene as 1% comp Wipe TSR tone ope pacong Tong we fasta paws ncaa cmc wee mmpoe ah ope eee eg acperetsl ts? Expy re wth epee eS | that the company uses the seigted average. method of Scing for ns and ose.” Prepare @ quantiy schedule end spay lose in Mandslong Cin. The cmpotaten of equivalent ands fr Maye scvgy for the ft faye fri sinle prod ~ popular armen ‘wo processing depaen's — Mixing and 2. Determine the cos per equivalent anit fo May ihow the flow of costs through the wo aercise 6 (Quantity Schedule, Eguivalat Unity ad Cost Per guivalent Unit FIFO Method) Addy In, manoactares an antacid product that pases hough $9 ‘cpntnens, Data for May forthe rs department flow Golios Mates Labor Overhead ‘ooo | Pohawo Pangc0 8000 seb daigNay mam 370000 9000 ‘he boyiming work in proces imeniony was 80% complete with respect | ‘inci nd 75% complete wih espetoproesing. The ending workin focns lavenlory was 60% complete With respect 12 materials and 2076 Complete with eps to oes Required: [Assume thatthe company uses the FIFO method of aseouning Fr wis {id cosa Pepe a quanity sede anda computation of % it or Ma's ati forthe st procesing parent ‘Determine the cots per quvalent anit for May ng ons 09 Job KCI. on order fay end of next month ‘es insed for 40 tania banks to be cost PHD. each 03 yas fared for 960 hardened ibs aly ids 05 P00 each S00AM unl 12:1SPM on Job KCI2, ZBASPM antl €30M on Job KCI23 scot be recorded? een recorded on each of Une documents for ined overhead rate anally on the ofthe year, it estimated that SEBO and the toa! dict lor ig overs fr the year ot was 41,000 hours. Sst Dg ob Cs nd Pre Cg “pa ndsties sur the weihedavrge method ns OSE Sng ‘ean os Assy Dope i ape = Wasa —| Tae Trad Woe pase Mage so Pa [PR one in a an s0—| peso [Pa eee 20 [—t00 0 Require Compute the cost per equivalent uni for materi, labor, for overhead tnd i Michel, he, produces win bots Fr vant ina process that tars in the Mel snd Mold Deparment. Data eonceing that parents operation in ‘he mos recent peiod appear below egianing wok ia process: Stage of completion wih respect to materials Stage of completion wih rexpest i convesion Unis started ino production daring he moth Units competed and wansfered out Ending werk in process ‘Units in process Stage completion with expect to materials ‘Stage of completion with espe! 0 conversion Required: ‘Mighell ses the FIFO mod ints proces omng tem vivant unis of production forthe period fOr the Melt Department i ste Gbuze L 5 spsystem, The following daa 5 secount, 721,000, 190,000 (PL78,000 direct matcinls TiO eed nest abo cost incur equipment, P40,000 Mens nured during October, 70,000 ng overhead cot to producti onthe Mere were 30,000 rachine hours 100 acorkng to thei ob cost seat and rasfeed to Fished Gooes 480,00 to complete according lo thee fo easiomers daring the mont These ast The goods were sold on account {nfermaion given above ing Overhead and Work in Process © each account. Compute the ‘esoming that Work in Process has that is sabject to wide season ae computed. on 2 quarter bess BY sts (terials, abr, and over The company"s estinated cos Y ____ ems Design: Job-Order Casting and Process 38 vine Fm pave Pie “noo "igo" atb00a iain 20.00 sean ian ued aie) eed (mae comport “Son Film Seem Management finds th varition in unit ost to be confusing ad cl Work with I as been suggested that the problem bes wis macufctrig reread, since it the gest element of cost. Acsordiagly, you have be hed find amore suitable way of signing manufacturing ovtbend cost {Suni podact Aer soe anal, you have determined changes i the Required The company uses « jobonder caning system. How would you

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