Job Order Costing

Problem 1
1.
Materials
Accounts Payable
2.

3.

4.
5.

Work in process
Factory OH Control
Materials

84,000
84,000
66,000
9,000
75,000

Materials
Work in process
Factory OH Control

2,400

Accounts Payable
Materials

3,000

1,500
900

Payroll
WT Payable
SSS Premiums Payable
PH Premium Payable
PAG-IBIG Premium Payable
Accrued Payroll

3,000
117,000
9,075
4,800

1,125
3,600
98,400

Cash
6.

Work in process
Factory OH Control
Payroll
117,000
7.

98,400
100,200
16,800

Factory OH Control
SSS Premiums Payable
PH Premium Payable

10,725
6,000

1,125
PAG-IBIG Premium Payable
3,600
8.

Factory OH Control
45,000
Accum. Depr Factory B & E

9,000
Prepaid Insurance
Accounts Payable
9.

Work in Process
Factory OH Applied

2,850
33,150
80,160

10.

Finished Goods
Work in Process
WP beg.
Added
DM
DL
FOA
Total

11.

Job 401
22,500
16,500
31,200
24,960
95,160

Accounts Receivable
Sales
Cost of Goods Sold
Finished Goods

216,660
216,660

Job 402
Total
33,000
55,500
21,000
37,500
30,000
121,500

37,500
68,700
54,960
216,660

133,224
133,224
95,160

95,160
12.

Cash

105,000
Accounts Receivable

13.

Factory overhead applied

Cost of Good sold

105,000
80,160
465

DM
9,000
16,500
25,500

Job 401
DL
7,500
31,200
38,700

FO
6,000
24,960
30,960
95,160

DM
16,800
21,000
37,800

Job 402
DL
FO
9,000
7,200
37,500 30,000
46,500 37,200
121,500

DM
28,500
( 1,500)

Job 403
DL
FO
31,500 25,200

83,700

3 Statement of Cost of Goods Manufactured and Sold

Direct Materials Used:
Materials, beginning
66,000
Add Net purchases
(84,000-3,000)
81,000
Total Available
147,000
Less Indirect materials
(9,000-900)
8,100
Materials, ending
74,400
82,500
Direct materials used
64,500
Direct labor
100,200
Factory overhead applied
80,160
Total manufacturing cost
244,860
Work-in-process,beginning
55,500
Total Goods put into process
300,360
Less work-in-process, ending
83,700
Total cost of goods manufactured
216,660
Finished goods, beginning
75,000
Total available
291,660
Less Finished goods, ending
196,500
Cost of good sold-normal
95,160
Add under applied overhead
465
Cost of good sold, actual
95,625

DL
2.
DM
DL
FO
TOTAL
3.

3,200
= 60% of DLC

Job No.1
Job No.2
8,000
15,000
3,200
6,500
1,920
3,900
13,120
25,400

JOB No. 1
1,200 x 60%
JOB No. 2
3,150 x 60%
JOB No. 3
7,500 x 60%
JOB No. 4
2,700 x 60%
Total factory overhead applied

4.
WP beg.
38,520
DM
29,500
DL
11,850
FO

6,500
= 60% of DLC

Job 1
13,120

Job 2

Total
23,000
9,700
5,820
38,520

=
=
=
=

720
1,8
4,500
1,620
8,730

Job 3
25,400

Total

3,000

8,500

18,0

1,200

3,150

7,50

720

1,890

4,5

5. Cost of Jobs sold -

Job No. 1
Job No. 3
Share Under -applied OH
5,220/8,730 x 2,910
Cost of goods sold actual

6. Job No. 2
Share Under-applied OH
1,890/8,730 x 2,910
Finished goods inventory
7. Job No. 4
DM
DL
FO
Share Under-applied OH
1,620/8730 x 2,910
Work in process inventory

18,040
30,000
1,740
49,780
38,940
630
39,570
9,500
2,700
1,620
540
14,360

Problem 3
1.

Raw and In Process

Accounts Payable

2.`

Finished Goods
`
Raw and In Process

1,050,000
1,050,000

1,050,300

1,050,

Mat. Purchased
1,050,000
Mat cost in RIP beg. (42,000-18,600)
23,400
Mat cost in RIP end (67,200-44,100) ( 23.100)
Mat. cost of units completed
1,050,300

3.

Cost of goods sold

Finished Goods

1,047,900
1,047,900

Mat. cost of units comp.

1,050,300
Mat cost in FG beg. (54,000-28,500)
25,500
Mat cost in FG end (59,400-31,500)( 27,900)
Material cost of units sold
1,047,900
4.

Cost of goods sold

Payroll
FO Applied
Raw and In Process
Finished Goods
Cost of goods sold
Balance end
Balance beg.
Increase (decrease)

891,000

375,00
516,000
25,500
3,000
28,500

RIP
FG
44,100
31,500
(18,600)
(28,500)
25,500
3,000

Problem 4

1) Original costs:
Direct materials (50 x P 240)
P 12,000
Direct labor
(50 x P 582)
29,100
Factory overhead (29,100 x 100%) 29,100 P 70,2
Additional cost
Direct materials
291
Direct labor
375
Factory overhead
375
1,041
Total costs
P 71,241
Less: Proceeds from spoiled (4 x 1,200)
4,800
Cost of completed units
P 66,441
Unit cost

66,441/46 P1,444.37

2)

ENTRIES
a)

Work in process
Materials
Payroll

70,200
12,000

29,100
Factory OH Applied
29,100
b)

Work in process
Materials
Payroll

1,041
291

375
Factory OH Applied
375
c)

Cash

4,800
Work in process

4,800

3) Original cost
Direct materials
Direct labor
Factory overhead applied
Total cost
Less: Cost of spoiled (4 x 1,404)
Cost of completed units
ENTRIES
a)

b)

c)
d)

12,000
29,100
29,100
70,200
5,616
64,58

Work in process
70,200
Materials
12,000
Payroll
29
Factory overhead applied
29,
Factory OH Control
1,041
Materials
291
Payroll
Factory overhead applied
Cash
4,800
Factory overhead control
816
Work in process
5,616
Finished goods
64,584
Work-in-process
64,584

Problem 5
a) Direct method

Producing_
Se
P1__
P2__
S1__
S2
Budgeted FO P564,000
P510,000
P135,000 P105,6
Allocated S1
60,000
75,000
(135,000)
S2
66,000
39,600
(105.600)
Total
P690,000
P624,600
Base
20,000DLHrs 15,000MHrs.
FO rate
P34,50/DLH P41.64/MHr.
b) Step method
Producing_
P1__
P2__
P564,000 P510,000

Service
S1__
S2__
P135,000
P10

Budgeted FO
Allocated
S1
54,000
67,500
(135,000)
13,500
S2
74,438
44,662
(119,100)
Total
P692,438 P622,162
Base
20,000DLH 15,000MH
FO rate P34.62/DLH P41.48/MHr.

c) Algebraic method
S1 = 135,000 + 20%S2
S2 = 105,600 + 10%S1
S1 = 135,000 + 20% (105,600 + 10%S1)
= 135,000 + 21,120 + .02S1
= 156,120/.98
= 159,306

S2 = 105,600 + 10%(159,306)
= 121,530
Producing_
Ser
P1__
P2__
S1__
S2_
Budgeted FO
P564,000 P 510,000
P 135,000
Allocated
S1
63,723
79,653
(159,306)
S2
60,765
36,459
24,306 (121,
Total
P688,488
626,112
Base
20,000DLHrs. 15,000MHrs.
FO rate
P34.42/DLH P41.74/MHr

12,000
DL
2,000
8,000
FO (100 x 25)
2,500
(400 x 25)
10,000
Total cost
P10,500
P
30,000
Cost per unit
P 210
P
300
Factory overhead rate = 200,750/8,030 = P25/DLHr.
2.

Product A

DM
12,000
DL
8,000
FO- MH (20xP50)
S&S ( 5 x P200)
1,600
DC ( 2 x P107.50)
537.50
NofP(10 x P100)

Product B
6,000
2,000
1,000
1,000

(50 x P50)
2,500
( 8 x P200)

215

( 5 x P107.50)

1,000

(15 x P100)

Multiple Choice
1. A
Materials cost in RIP,
Materials cost
P 26,250 in
beg
FG, beg
Materials

P 20,000

Materials cost
562,500 of

561,250

purchased/processed
Materials cost in RIP,
unts
Materials cost
completed
(27,500) in
FG, end
end
Materials cost
Materials cost of
P561,250 of
sold units
completed
units

(17,500)
P 563,750

2. A
Raw Materials purchased
Increase in materials inventory
Materials used

P1,290,000
(45,000)
P1,245,000

3. B
MSU : P 20,000 / 200 su = P100 per isu x 4
INSP : P130,000 / 6,500 insp = P 20 per insp
x 30
MH : P 80,000 / 8,000 moves = P 10 per move x 50
ENG : P 50,000 / 1,000 eng hrs = P 50 per eng hr x 10
Total
2,000

P 400
600
500
500

4. D
Prime cost : P 90,000 + P 60,000
P 150,000
Conversion cost : P 60,000 + P 80,000
140,000
Total Mfg Cost
: P 90,000 + P 60,000 + P 80,000
230,000
COGM
: P 230,000 + P 18,000 P 12,000
236,000
5. C
Indirect Materials (P120,000 x 20%)
Indirect labor
Other overhead items
Total actual factory overhead

P 24,000
33,000

6. C
Direct materials (120,000 x 25%)
Direct Labor
(4,200 direct labor hours x P8.50)
FO Applied
(P 35,700 direct labor cost x 120%)
Total Cost
P 108,540

36,000
93,000

P 30,000
35,700
42,840

7. D
Sales (P25,000 / 12.5%) P200,000
Less Gross Profit (P25,200 + P25,000)
50,200
Cost of goods sold, actual
P149,800
Add: Over applied FO(P62,800 P 63,000)
Cost of good sold Normal P150,000
FG, end
78,000
FG, beg
(60,000)
COGM
P168,000
WIP, end
95,000
WIP, beg
(80,000)
Total manufacturing cost P183,000
Less: FO applied
63,000
Direct Labor
(P63,000 / 75%) 84,000
Direct Materials used
P 36,000
Materials, end
50,000
Indirect materials
1,000
Materials purchased
(46,000)
Materials, beg
P 41,000

200

(147,000)

8. C
Original Cost (9,000 + 4,800 + P 3,750) P 17,550
Additional rework cost (P1,500 + P800 + P60)
Total cost after rework
p 19,910
Divided by units produced
5,000
Unit cost P 3.982
9. D
FO Applied (P 22,800 less total direct cost of P19,500)
Divided by direct labor cost (P 3,000 + P 2,500)
PDR
60% of DLC
Total Mfg cost DM (3,000 + 2,000 + 6,000 + 4,500)
DL (1,000 + 1,500 + 2,600 + 2000)
7,100
FO (P 7,100 X 60%)
4,260
26,860
add: work in process, beg 22,800
total goods put into process
P49,660

2,360

3,300
5,500

P 15,500

10. C
Total goods put into process (see item 9)
P 49,660
Less Work-in-process
, end
#102 (8,000 + 2,500 1,500 + 2,000 + 1,500 + 900) P 16,400
#104 (4,500 + 2,000 + 1,200 )
7,700 (24,100)
COGM
P 25,560
11. C
Work-in-process, 12/31/13
P 9,000
Less: FO P 2,250
Direct Labor (2,250 / 90%)
2,500
Direct material cost
P 4,250

( 4,750)

12. A
Overhead Rate (180,000 + 215,000 + 38,000 / 80,000 mh)
FO applied
(74,000 mh x P 5.4125)
P 400,525
FO actual
387,875
Overapplied
P 12,650

P5.415/mh