ADMS 2510 Lecture Notes - Management Accounting, Income Statement, Finished Good

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pearimpala756

30 May 2012

School

York University

Department

Administrative Studies

Course

ADMS 2510

Professor

John Parkinson

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ADMS 2510 Full Course Notes

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Job order costing: process costing produce a number of product over and over again with insignificant differences. It is meaningless to cost them individually: job order costing- produce many different products. Note that cost helps to figure prices, profit margin, budgeting etc. Bombardier would not be a job order costing, as it does not customize the product to your specification. So it"s more likely to be in the middle. Direct cost gets directly charged to jobs because they can be traced. Note that manufacturing overhead including indirect cost are allocated to jobs as per machine hours, labour hours and others. For this purpose we use predermined rate pohr and thus estimate the cost to be and apply the pohr with the actual activity to find the cost. Sale order is issued and production order follows. Note that when materials are used, it could be direct or indirect. All sorts of manufacturing overhead is accounted for in the job cost sheet.

Related Questions

Identify each statement as true or false. If false, indicate howto correct the statement.

1. Process cost systems are used to apply costs to similarproducts that are mass-produced in a continuous fashion.
2. A process cost system is used when each finished unit isindistinguishable from another.
3. Companies that produce soft drinks, motion pictures, andcomputers chips would all use process cost accounting.
4. In a process cost system, costs are tracked by individualjobs.
5. Job order costing and process costing track differentmanufacturing costs elements.
6. Both job order costing and process costing account for directmaterials, direct labor, and manufacturing overhead.
7. Costs flow through the accounts in the same basic way for bothjob order costing and process costing.
8. In a process cost system, only one work in process account isused.
9. In a process cost system, costs are summarized in a job costsheet.
10. In a process cost system, the unit cost is total manufacturingcosts for the period divided by the units produced during theperiod.

byzantiumpanda529

1. Process costing is normally used when:

a. large numbers of different products are manufactured

b. large numbers of nearly identical products aremanufactured

c. small numbers of nearly identical products aremanufactured

d. the fixed costs of manufacturing exceed the variable cost ofmanufacturing

2. Manufacturing overhead:

a. consists of direct material and direct labour costs

b. is easily traced to jobs

c. should not be assigned to individual jobs because it bears noobvious relationship to them

d. is a heterogeneous pool of indirect production costs that caninclude gas and electricity costs and depreciation

orchidelk884

Moody Corporation uses a job-order costing system with a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, the company made the following estimates:


Machine-hours required to support estimated production		151,000
Fixed manufacturing overhead cost	$	656,000
Variable manufacturing overhead cost per machine-hour	$	5.00


Direct materials	$	310
Direct labor cost	$	300
Machine-hours used		35

QUESTION: If Moody uses a markup percentage of 130% of its total manufacturing cost, then what selling price per unit would it have established for Job 400?

rosereindeer205

ADMS 2510 Lecture Notes - Management Accounting, Income Statement, Finished Good

ADMS 2510 Full Course Notes

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