Materials were requisitioned to individual jobs as follows: Polyester Filling Total Fabric $205,000 Lumber Glue Job 601 $ 75,000 $120,000 $400,000 Job 602 110,000 36,000 88,000 234,000 Job 603 130,000 55,000 125,000 310,000 Factory overhead-indirect materials $34,800 $34,800 34,800 Total $445,000 $166,000 $33,000 $978,800 The glue is not a significant cost, so it is treated as indirect materials (factory overhead). a. Journalize the entry to record the purchase of materials in June. b. Journalize the entry to record the requisition of materials in June. c. Determine the June 30 balances that would be shown in the materials ledger accounts.
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Entries for materials
GenX Furnishings manufactures designer furniture. GenX Furnishings uses a
| Fabric | $40,500 |
| Polyester filling | 28,600 |
| Lumber | 62,400 |
| Glue | 6,550 |
The materials purchased during June are summarized from the receiving reports as follows:
| Fabric | $ 440,000 |
| Polyester filling | 130,000 |
| Lumber | 360,000 |
| Glue | 40,000 |
Materials were requisitioned to individual jobs as follows:
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