Chapter 1 Review
Job Order Cost Cycle
Problem 1: Job Cost Sheets - Job Order Cost Computation
During the month of April, Antonia Manufacturing Company had two jobs under production, Job 234 and 56
transactions occurred:
a Purchased materials for P100,000.
b Materials requisitioned were P35,000 for Job 234 and P59,000 for Job 567.
Factory payroll for the month of April was P80,000, of which P35,000 was directly allocated to Job 234, and
c
The remainder represented general factory supervision.
d Materials returned to stockroom from Job 234, P2,500.
e
Supplies purchased and used amounted to P3,000. These were not specifically traced to either of the two jo
f
Various overhead costs, including power, maintenance and insurance, amounted to P34,000 during the mon
g Depreciation on factory building and equipment for the month was P6,000.
h Overhead is charged to jobs at the rate of 100 percent of direct labor cost.
i
Job 234 was completed and delivered to the customer, but Job 567 was still in process at the end of the mo
Required:
1 Compute the cost of Job 234 and 567.
Assuming that no other jobs were in process, and that no other materials were on hand at the start of the m
2 the end of the month balances of:
a. Materials account.
b. Work in Process account.
c. Cost of Goods Sold account.
Materials WIP Job 234 Finished Goods
a. 100,000 b. 94,000 b. 35,000 d. 2,500 i. 102,500
d. 2,500 c. 35,000 i. 102,500
h. 35,000
EB 8,500 EB 0 EB
Factory Payroll WIP Job 567 COGS
c. 80,000 c. 80,000 b. 59,000 i. 102,500
c. 30,000
h. 30,000
EB 0 EB 119,000 EB 102,500
MOH Control Answer:
c. 15,000 h. 65,000 1 Cost of Jobs:
f. 34,000 Direct materials used
g. 6,000 Direct labor
Applied factory overhead
EB 10,000 Total factory cost
2: (a) Purchases of materials
Materials requisitioned
Note: Materials returned to storeroom
Transaction "e" has no entry in any of the Materials account balance
account above because it will not affect
either of the two jobs, it is assumed to (b) Materials requisitioned
consumed for general and administrative Direct labor
purposes. Applied factory overhead
Materials returned for Job 234
Completed job 234
Work in process, end
(c) Cost of goods sold (Job 234)
roduction, Job 234 and 567. The following
allocated to Job 234, and P30,000 to Job 567.
ced to either of the two jobs.
o P34,000 during the month.
ocess at the end of the month.
hand at the start of the month, what should be
Finished Goods
i. 102,500
COGS
Job 234 Job 567
P 35,000 P 59,000
35,000 30,000
35,000 30,000
P102,500 P119,000
P100,000
(94,000)
2,500
P 8,500
P 94,000
65,000
65,000
(2,500)
(102,500)
P119,000
P102,500
P119,000
Problem 2:
Roman Company uses normal costing. Its job costing system has two direct-cost categories (direct
materials and direct labor) and one indirect cost category (manufacturing overhead). The following
information is obtained from the company's records for 2021:
Total manufacturing costs, P8,000,000.
Cost of finished goods manufactured, P7,920,000.
Manufacturing overhead applied, P3,600,000.
Manufacturing overhead was applied to production at a rate of 200% of direct labor costs.
The peso amount of work in process inventory on January 1, 2021 was P320,000.
Questions:
1. What is the total direct labor costs in 2021?
2. What is the total cost of direct materials used in 2021?
3. What is the peso amount of work in process inventory on December 31, 2021?
Answers:
1. Total direct labor costs
Applied manufacturing overhead P3,600,000
Divided by: Application rate 200%
Direct Labor costs P1,800,000
2. Direct Materials Used
Total Manufacturing Costs P 8,000,000
Direct Labor 1,800,000
Applied manufacturing overhead 3,600,000
Direct Materials Used P 2,600,000
3. WIP, December 31, 2021
Manufacturing cost P8,000,000
Work in process, 01/01 320,000
Cost of goods manufactured (7,920,000)
Work in process inventory, 12/31 P 400,000
egories (direct
The following
Note:
To understand the solution, always remember the statement of cost of goods sold:
Raw materials, beginning P xxx
Add: Purchases xxx
Materials available for use P xxx
Less: Raw materials, ending xxx
Direct Materials Used P xxx
Add: Direct Labor xxx
Applied Manufacturing Overhead xxx
Total Manufacturing Costs P xxx
Add: WIP, beginning xxx
Total Goods Put in Process P xxx
Less: WIP, ending xxx
Total Cost of goods Manufactured P xxx
Add: Finished Goods, beginning xxx
Total Goods Avaulable for Sale P xxx
Less: Finished Goods, ending xxx
Total Cost of Goods Available for Sale P xxx
