Chapter 19 – Job Order Costing
Problem 19-4B (35 minutes)
Part 1
a. Predetermined overhead rate
= = = 50%
b. Overhead costs charged to jobs
Direct Applied
Job No. Labor Overhead (50%)
625…………………………………………..…………….…….$ 354,000 $177,000
626…………………………………………..…………….…….330,000 165,000
Total…………………………………………………..…………$1,473,000 $736,500
c. Overapplied or underapplied overhead determination
Actual overhead cost……………………………………………………… $725,000
Less applied overhead cost……………………………………..…….. 736,500
Overapplied overhead……………………………….….……………….. $ (11,500)
Part 2
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Estimated overhead costs
Estimated direct labor cost
$750,000 $750,000
[50 x 2,000 x $15] $1,500,000
Chapter 19 – Job Order Costing
Problem 19-5B (90 minutes)
JOB COST SHEET
Customer’s Name Encinita Company Job No. 450
Direct Materials Direct Labor Overhead Costs Applied
Date
Requisition
Number Amount
Time
Ticket
Number Amount Date Rate Amount
Total 25,600 Total 40,000
FI N I S H E D
JOB COST SHEET
Customer’s Name Fargo, Inc. Job No. 451
Direct Materials Direct Labor Overhead Costs Applied
Date
Requisition
Number Amount
Time
Ticket
Number Amount Date Rate Amount
Total cost of Job…………………………………………………………………….....................
.
Total Total
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Chapter 19 – Job Order Costing
Problem 19-5B (Continued)
MATERIALS LEDGER CARD
Item Material M
Received Issued Balance
Date
Receivin
g Report Unit
s
Unit
Price
Total
Price
Requi–
sition Unit
s
Unit
Pric
e
Total
Price Unit
s
Unit
Pric
e
Total
Price
June
1120 200 24,00
0
#20 150 200 30,00
270 200 54,00
MATERIALS LEDGER CARD
Item Material R
Received Issued Balance
Date
Receivin
g Report Unit
s
Unit
Price
Total
Price
Requi–
sition Unit
s
Unit
Pric
e
Total
Price Unit
s
Unit
Pric
e
Total
Price
#224 60 160 9,600 90 160 14,40
0
#226 30 160 4,800 60 160 9,600
MATERIALS LEDGER CARD
Item Paint
Received Issued Balance
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Chapter 19 – Job Order Costing
Date
Receivin
g Report Unit
s
Unit
Price
Total
Price
Requi–
sition Unit
s
Unit
Price
Total
Pric
e
Unit
s
Unit
Pric
e
Total
Pric
e
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Chapter 19 – Job Order Costing
Problem 19-5B (Continued)
GENERAL JOURNAL
a. Raw Materials Inventory…………………….………….……….41,200
Accounts Payable…………………………………………….. 41,200
To record materials purchases ($30,000+$11,200).
To record direct & indirect labor.
*($40,000 + $32,000)
Factory Overhead…………………………………………..………36,800
f. Accounts Receivable……………………………………………..290,000
Sales………………………………………………..……………… 290,000
To record sales on account.
Cost of Goods Sold……………………………………….……….93,600
Finished Goods Inventory………………………………… 93,600
*($16,000 + $8,000 + $9,600 + $4,800)
i. Work in Process Inventory……………………….…………….50,400
Factory Overhead…………………………………………….. 50,400
To apply overhead ($28,000 + $22,400).
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Chapter 19 – Job Order Costing
Problem 19-5B (Continued)
j. The ending balance in Factory Overhead is computed as:
Actual Factory Overhead
Miscellaneous overhead……..……. $36,800
Indirect materials……………………... 864
SERIAL PROBLEM— SP 19
Serial Problem—SP 19, Business Solutions (40 minutes)
1.The cost of direct materials requisitioned in the month equals the total
direct materials costs accumulated on the three jobs less the amount of
direct materials cost assigned to Job 602 in May:
Job 602 ………………………………………………………….……..$1,500
Less prior costs……………………………………………………. (600) $ 900
2.Direct labor cost incurred in the month equals the total direct labor
costs accumulated on the three jobs less the amount of direct labor cost
assigned to Job 602 in May:
Job 602 ………………………………………………………….…….. $ 800
Less prior costs……………………………………………………. (180) $ 620
Job 603 ………………………………………………………….…….. 1,420
3.The predetermined overhead rate equals the ratio between the amount
of overhead assigned to the jobs divided by the amount of direct labor
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Chapter 19 – Job Order Costing
Job 602 Job 604
Overhead……………………………………………………… $ 400 $1,050
4. The cost transferred to finished goods in June equals the total costs of
the two completed jobs for the month, which are Jobs 602 and 603:
Job 602 Job 603 Total
Direct materials……………….…..…..….…. $1,500 $3,300 $4,800
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Chapter 19 – Job Order Costing
Reporting in Action — BTN 19-1
1. We would anticipate that at least two types of costs will increase as a
percent of sales with Apple’s growth in sales. The first type is broadly
classed into variable costs. Variable costs are the usual operating costs
2. Both types of costs identified in part 1 are likely to increase as Apple
increases sales. Examples of specific items include communication,
advertising, training, travel, and management costs. In addition, if
growth is sufficiently large to push Apple’s sales beyond its current
3. Solution depends on the annual report information obtained.
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