管理会计课件-chapter-

ChapterThreeSystemsDesign:

Job-OrderCostingProductCostFlowsCostsassociatedwiththegoodsthatarecompletedduringtheperiodaretransferredtofinishedgoodsinventory.LearningObjective1Distinguishbetweenprocesscostingandjob-ordercostingandidentifycompaniesthatwoulduseeachcostingmethod.TypesofProductCostingSystemsProcess

CostingJob-order

Costing

Acompanyproducesmanyunitsofasingle product. Oneunitofproductisindistinguishablefrom otherunitsofproduct. Theidenticalnatureofeachunitofproduct enables assigningthesameaveragecostperunit.TypesofProductCostingSystemsProcess

CostingJob-order

Costing

Acompanyproducesmanyunitsofasingle product. Oneunitofproductisindistinguishablefrom otherunitsofproduct. Theidenticalnatureofeachunitofproduct enables assigningthesameaveragecostperunit.Examplecompanies:

1.Weyerhaeuser(papermanufacturing)

2.ReynoldsAluminum(refiningaluminumingots)3.Coca-Cola(mixingandbottlingbeverages)TypesofProductCostingSystemsProcess

CostingJob-order

Costing

Manydifferentproductsareproducedeachperiod. Productsaremanufacturedtoorder. Theuniquenatureofeachorderrequirestracingor allocatingcoststoeachjob,andmaintainingcost recordsforeachjob.TypesofProductCostingSystemsProcess

CostingJob-order

Costing

Manydifferentproductsareproducedeachperiod. Productsaremanufacturedtoorder. Theuniquenatureofeachorderrequirestracingor allocatingcoststoeachjob,andmaintainingcost recordsforeachjob.Examplecompanies:

1.Boeing(aircraftmanufacturing)

2.BechtelInternational(largescaleconstruction)3.WaltDisneyStudios(movieproduction)ComparingProcessandJob-OrderCostingLearningObjective2Identifythedocumentsusedinajob-ordercostingsystem.ManufacturingOverheadJobNo.1JobNo.2JobNo.3Chargedirectmaterialanddirectlaborcoststoeachjobasworkisperformed.Job-OrderCosting–AnOverviewDirectMaterialsDirectLaborManufacturingOverhead,includingindirectmaterialsandindirectlabor,areallocatedtoalljobsratherthandirectlytracedtoeachjob.DirectManufacturingCostsDirectMaterialsDirectLaborJobNo.1JobNo.2JobNo.3ManufacturingOverheadPearCoJobCostSheetJobNumberA-143DateInitiated3-4-05DateCompletedDepartmentB3UnitsCompletedItemWoodencargocrateDirectMaterialsDirectLaborManufacturingOverheadReq.No.AmountTicketHoursAmountHoursRateAmountCostSummaryUnitsShippedDirectMaterialsDateNumberBalanceDirectLaborManufacturingOverheadTotalCostUnitProductCostTheJobCostSheetMeasuringDirectMaterialsCostWillE.DeliteMeasuringDirectMaterialsCostMeasuringDirectLaborCostsJob-OrderCostAccountingLearningObjective3Computepredeterminedoverheadrates

Thepredeterminedoverheadrate(POHR)usedtoapplyoverheadtojobsisdeterminedbeforetheperiodbegins.ManufacturingOverheadApplicationEstimatedtotalmanufacturing

overheadcostforthecomingperiodEstimatedtotalunitsinthe

allocationbaseforthecomingperiodPOHR=Ideally,theallocationbaseisacostdriverthatcausesoverhead.Actualamountoftheallocationbasedupontheactuallevelofactivity.Basedonestimates,anddeterminedbeforetheperiodbegins.ApplicationofManufacturingOverheadOverheadapplied=POHR×ActualactivityForeachdirectlaborhourworkedonaparticularjob,$4.00offactoryoverheadwillbeappliedtothatjob.OverheadApplicationRatePOHR=$4.00perDLH$640,000160,000directlaborhours(DLH)POHR=Estimatedtotalmanufacturing

overheadcostforthecomingperiodEstimatedtotalunitsinthe

allocationbaseforthecomingperiodPOHR=Job-OrderCostAccountingJob-OrderCostAccountingInterpretingtheAverageUnitCostTheaverageunitcostshouldnotbeinterpretedasthecoststhatwouldactuallybeincurredifan

additionalunitwereproduced.

Fixedoverheadwouldnotchangeifanotherunit

wereproduced,sotheincrementalcostof

anotherunitmaybesomewhatlessthan$118.QuickCheck

JobWR53atNWFab,Inc.required$200ofdirectmaterialsand10directlaborhoursat$15perhour.Estimatedtotaloverheadfortheyearwas$760,000andestimateddirectlaborhourswere20,000.WhatwouldberecordedasthecostofjobWR53?a.$200.b.$350.c.$380.d.$730.QuickCheck

JobWR53atNWFab,Inc.required$200ofdirectmaterialsand10directlaborhoursat$15perhour.Estimatedtotaloverheadfortheyearwas$760,000andestimateddirectlaborhourswere20,000.WhatwouldberecordedasthecostofjobWR53?a.$200.b.$350.c.$380.d.$730.LearningObjective4Understandtheflowofcostsinajob-ordercostingsystemJob-OrderCosting

DocumentFlowSummaryAsalesorderisthebasisofissuingaproductionorder.Aproductionorderinitiatesworkonajob.Job-OrderCosting

DocumentFlowSummaryJobCostSheetsMaterials

RequisitionManufacturingOverheadAccountDirectmaterialsIndirectmaterialsMaterialsused

maybeeither

director

indirect.Job-OrderCosting

DocumentFlowSummaryJobCostSheetsEmployeeTimeTicketManufacturingOverheadAccountAnemployee’s

timemaybeeither

directorindirect.DirectLaborIndirectLaborJob-OrderCosting

DocumentFlowSummaryManufacturingOverheadAccountOther

ActualOH

ChargesJobCostSheetsApplied

OverheadMaterials

RequisitionEmployee

TimeTicketIndirect

MaterialIndirect

LaborLearningObjectives5UseT-accountstoshowtheflowofcostsinajob-ordercostingsystemandprepareappropriatejournalentriestorecordcosts..RawMaterialsMaterialPurchasesMfg.OverheadWorkinProcess

(JobCostSheet)ActualAppliedDirect

MaterialsDirect

MaterialsIndirect

MaterialsIndirect

MaterialsThePurchaseandIssueofRawMaterialsCostFlows–MaterialPurchasesRawmaterialpurchasesarerecordedinan

inventoryaccount.CostFlows–MaterialUsage

DirectmaterialsissuedtoajobincreaseWorkinProcessanddecreaseRawMaterials.IndirectmaterialsusedarechargedtoManufacturingOverheadandalsodecreaseRawMaterials.Mfg.OverheadSalariesandWagesPayableWorkinProcess

(JobCostSheet)Direct

MaterialsDirect

LaborDirect

LaborIndirect

MaterialsActualAppliedIndirect

LaborIndirect

LaborTheRecordingofLaborCostsTheRecordingofLaborCosts

ThecostofdirectlaborincurredincreasesWorkinProcessandthecostofindirectlaborincreasesManufacturingOverhead.Mfg.OverheadSalariesandWagesPayableWorkinProcess

(JobCostSheet)Direct

MaterialsDirect

LaborDirect

LaborIndirect

MaterialsActualAppliedIndirect

LaborIndirect

LaborRecordingActualManufacturingOverheadOther

OverheadRecordingActualManufacturingOverhead

Inadditiontoindirectmaterialsandindirectlabor,othermanufacturingoverheadcostsarechargedtotheManufacturingOverheadaccountastheyareincurred.LearningObjective6ApplyoverheadcosttoWorkinProcessusingapredeterminedoverheadrate.Mfg.OverheadSalariesandWagesPayableWorkinProcess

(JobCostSheet)Direct

MaterialsDirect

LaborDirect

LaborIndirect

MaterialsActualAppliedIndirect

LaborIndirect

LaborApplyingManufacturingOverheadOther

OverheadOverhead

AppliedOverhead

AppliedtoWorkin

ProcessIfactualandappliedmanufacturingoverhead

arenotequal,ayear-endadjustmentisrequired.ApplyingManufacturingOverhead

WorkinProcessisincreasedwhenManufacturingOverheadisappliedtojobs.LearningObjective6Prepareschedulesofcostofgoodsmanufacturedandcostofgoodssold.FinishedGoodsWorkinProcess

(JobCostSheet)Direct

MaterialsDirect

LaborOverhead

AppliedCostof

Goods

Mfd.Costof

Goods

Mfd.TransferringCompletedUnitsTransferringCompletedUnits

Asjobsarecompleted,theCostofGoodsManufacturedistransferredtoFinishedGoodsfromWorkinProcess.FinishedGoodsCostofGoodsSoldWorkinProcess

(JobCostSheet)Direct

MaterialsDirect

LaborOverhead

AppliedCostof

Goods

Mfd.Costof

Goods

Mfd.Costof

Goods

SoldCostof

Goods

SoldTransferringUnitsSoldTransferringUnitsSold

Whenfinishedgoodsaresold,twoentriesarerequired:(1)torecordthesale,and(2)torecordCOGSandreduceFinishedGoods.LearningObjective8ComputeunderappliedoroverappliedoverheadcostandpreparethejournalentrytoclosethebalanceinManufacturingOverheadtotheappropriateaccounts.ProblemsofOverheadApplicationThedifferencebetweentheoverheadcostappliedtoWorkinProcessandtheactualoverheadcostsofaperiodisreferredtoaseitherunderappliedoroverappliedoverhead.Underappliedoverheadexistswhentheamountofoverheadappliedtojobsduringtheperiodusingthepredeterminedoverheadrateislessthanthetotalamountofoverheadactuallyincurredduringtheperiod.Overappliedoverheadexistswhentheamountofoverheadappliedtojobsduringtheperiodusingthepredeterminedoverheadrateisgreaterthanthetotalamountofoverheadactuallyincurredduringtheperiod.

PearCo’sactualoverheadfortheyearwas$650,000withatotalof170,000directlaborhoursworkedonjobs.HowmuchtotaloverheadwasappliedtoPearCo’sjobsduringtheyear?UsePearCo’spredeterminedoverheadrateof$4.00perdirectlaborhour.OverheadApplicationExampleOverheadAppliedDuringthePeriodAppliedOverhead=POHR×ActualDirectLaborHoursAppliedOverhead=$4.00perDLH×170,000DLH=$680,000

PearCo’sactualoverheadfortheyearwas$650,000withatotalof170,000directlaborhoursworkedonjobs.HowmuchtotaloverheadwasappliedtoPearCo’sjobsduringtheyear?UsePearCo’spredeterminedoverheadrateof$4.00perdirectlaborhour.OverheadApplicationExampleOverheadAppliedDuringthePeriodAppliedOverhead=POHR×ActualDirectLaborHoursAppliedOverhead=$4.00perDLH×170,000DLH=$680,000PearCohasoverapplied

overheadfortheyear

by$30,000.Whatwill

PearCodo?

Tiger,Inc.hadactualmanufacturingoverheadcostsof$1,210,000andapredeterminedoverheadrateof$4.00permachinehour.Tiger,Inc.worked290,000machinehoursduringtheperiod.Tiger’smanufacturingoverheadis a.$50,000overapplied.

b.$50,000underapplied.

c.$60,000overapplied.

d.$60,000underapplied.QuickCheck

Tiger,Inc.hadactualmanufacturingoverheadcostsof$1,210,000andapredeterminedoverheadrateof$4.00permachinehour.Tiger,Inc.worked290,000machinehoursduringtheperiod.Tiger’smanufacturingoverheadis

a.$50,000overapplied.

b.$50,000underapplied.

c.$60,000overapplied.

d.$60,000underapplied.QuickCheckOverheadApplied

$4.00perhour×290,000hours

=$1,160,000UnderappliedOverhead

$1,210,000-$1,160,000

=$50,000DispositionofUnder-orOverappliedOverhead$30,000maybe

closeddirectlyto

costofgoodssold.Costof

GoodsSoldPearCo’sMethodWorkin

ProcessFinished

GoodsCostof

GoodsSold$30,000

maybeallocated

totheseaccounts.ORDispositionofUnder-orOverappli