Get Instant Help From 5000+ Experts For
question

Writing: Get your essay and assignment written from scratch by PhD expert

Rewriting: Paraphrase or rewrite your friend's essay with similar meaning at reduced cost

Editing:Proofread your work by experts and improve grade at Lowest cost

And Improve Your Grades
myassignmenthelp.com
loader
Phone no. Missing!

Enter phone no. to receive critical updates and urgent messages !

Attach file

Error goes here

Files Missing!

Please upload all relevant files for quick & complete assistance.

Guaranteed Higher Grade!
Free Quote
wave

Answer to Question 1: Job costing

Part A

Raw Material Account

Particular

Amount

Particular

Amount

Opening balance

 $   16,755.00

Work-in-progress

 $     2,010.00

Raw material

 $     5,255.00

Closing Stock of Raw material

 $   20,000.00

Total

 $   22,010.00

Total

 $   22,010.00

Work-in Process Account

Particular

Amount

Particular

Amount

Opening balance

 $     6,700.00

Cost of goods manufactured

 $   30,110.00

Raw material

 $     2,010.00

Direct Labor

 $   14,800.00

Manufacturing OH

 $   14,800.00

Closing balance

 $     8,200.00

Total

 $   38,310.00

Total

 $   38,310.00

Accounts payable

Particular

Amount

Particular

Amount

Bank account

 $     6,700.00

Opening balance

 $     2,345.00

Closing balance

 $        900.00

Raw Materials purchased

 $     5,255.00

Total

 $     7,600.00

Total

 $     7,600.00

Finished Goods

Particular

Amount

Particular

Amount

Op balance

 $    8,790.00

Cost of goods sold

 $   30,000.00

Cost of goods manufactured

 $  30,110.00

closing balance

 $     8,900.00

Total

 $  38,900.00

Total

 $   38,900.00

Cost of goods sold

Particular

Amount

Particular

Amount

Finished Goods

 $  30,000.00

Cost of sales

 $   30,000.00

Total

 $  30,000.00

Total

 $   30,000.00

Calculation of Closing WIP

Particulars

Amount

Material

 $    7,000.00

labour

 $    1,200.00

Closing WIP

 $    8,200.00

calculation of Overhead absorption rate

Particulars

Amount

Overhead (Budgeted)

 $   12,000.00

Budgeted Labor hours

3000

Overhead Absorption rate

 $            4.00

calculation of Labor hour rate

Particulars

Amount

Labor amount

 $    1,200.00

Labor hours

300

Labor hour Rate

4.00

Part B

It can be inferred that the excel spreadsheet was created first, than the manual sheet. This is mainly because, with the excel spreadsheet, balances can be cross checked and closing balances can be matched automatically.

Part C

Job costing

Process Costing

Operating costing

The job costing process involves total accumulation of costs of labor, material in terms of specific jobs.

In this method, production is done based on different processes and costs are calculated based on different units of processes.

Operating costing method can be considered as a mixture of both job costing and process costing

It is applicable in software industry

It is applicable in manufacturing industry

It is applicable in customized programs.

Table: Difference between three costing systems

(Source: Liu & Kuang, 2014).

Calculation of Equivalent Units

Particulars

Direct Material

Direct Labor

Overhead

physical units

Units Completed

20000

20000

20000

20000

Closing WIP

10000

4000

4000

10000

Total

30000

24000

24000

30000

Calculation of Costs per equivalent unit

Particulars

Direct Material

Direct Labor

Overhead

Total

Cost in the Beginning

 $             10,000.00

 $          3,750.00

 $                               2,250.00

 $             16,000.00

Costs incurred during the year

 $             50,000.00

 $         30,000.00

 $                             18,000.00

 $             98,000.00

Total

 $           60,000.00

 $      33,750.00

 $                           20,250.00

 $        114,000.00

Cost per equivalent unit

2.00

1.41

0.84

4.25

Statement showing assigning the cost to units transferred

Particulars

Direct Material

Direct Labor

Overhead

Total

Cost of units transferred

 $             40,000.00

 $         28,125.00

 $                             16,875.00

 $             85,000.00

Closing WIP

 $             20,000.00

 $          5,625.00

 $                               3,375.00

 $             29,000.00

Total

 $           60,000.00

 $      33,750.00

 $                           20,250.00

 $        114,000.00

Work in Progress  Account

Particulars

Units

Amount

Particulars

Units

Amount

Opening  balance

5000

 $         16,000.00

Transfer to next process

20000

 $    85,000.00

Material Introduced

25000

 $         50,000.00

Labor

 $         30,000.00

overhead

 $         18,000.00

Closing balance

10000

 $    29,000.00

Total

30000

 $    114,000.00

Total

30000

 $114,000.00

Units to be Accounted

Particulars

Amount

Units at the beginning WIP

5000

Units started during the month

25000

Total Units

30000

a) i)

Calculation of Joint cost per kg

Particulars

Amount

Process 1 Cost

 $   124,000.00

Sales of Sludge

 $     (5,600.00)

Net Process cost

 $ 118,400.00

Net Output (kg)

16000

Joint cost per kg

 $             7.40

Statement showing profit for Grade A products

Particulars

Amount

Sales of Grade A products

 $   252,000.00

Extra cost in Process 2

 $    (72,000.00)

Joint cost

 $    (66,600.00)

Packaging cost

 $     (9,000.00)

Gross Profit

 $ 104,400.00

Statement showing profit for Grade B products

Particulars

Amount

Sales of Grade B Products

 $   168,000.00

Extra Cost for Process 3

 $    (48,000.00)

Joint cost

 $    (51,800.00)

Packaging costs

 $     (7,000.00)

Gross Profit

 $   61,200.00

ii)

Calculation showing allocation of Joint costs

Particulars

Amount

Net Process cost

 $   118,400.00

Sales of Grade A products

 $   252,000.00

Sales of Grade B Products

 $   168,000.00

Total Sales

 $ 420,000.00

Joint cost / sales amount

 $            0.28

Statement showing profit for Grade A products

Particulars

Amount

Sales of Grade A products

 $   252,000.00

Extra cost in Process 2

 $    (72,000.00)

Joint cost

 $    (71,040.00)

Packaging cost

 $     (9,000.00)

Gross Profit

 $   99,960.00

Statement showing profit for Grade B products

Particulars

Amount

Sales of Grade B Products

 $   168,000.00

Extra Cost for Process 3

 $    (48,000.00)

Joint cost

 $    (47,360.00)

Packaging costs

 $     (7,000.00)

Gross Profit

 $   65,640.00

Workings:

Particulars

Amount

Process 1 Cost

 $   124,000.00

Process 1 Output Kg

17600

Sludge sold to road builders (kg)

1600

Net Output (kg)

16000

Transfer to Process 2 Output (kg)

9000

Extra cost in Process 2

 $     72,000.00

Grade A output from process 2

9000

Selling Price Grade A output

 $           28.00

Transfer to Process 3 (kg)

7000

Extra Cost for Process 3

 $     48,000.00

Grade B output from Process 3 (kg)

7000

Selling Price Grade B output

 $           24.00

Sludge sells (per kg)

 $             3.50

Packaging cost

 $             1.00

From the above table, it can be inferred that revenue of byproduct is being deducted from process 1. Therefore, cost of process 1 has decreased which in turn has increased the total profit of the firm. On the other hand, revenue has being treated as a separate income. From this, it can be inferred that revenue and expenditure has been adjusted.

Answer to 4A 1.

Calculation showing actual hours worked

Particulars

Amount

Standard Direct Labor Rate

 $           12.00

Actual Direct labor rate

 $           14.00

Standard Direct labor hour

12000

Direct Labor Usage Variance (A)

 $     11,000.00

Standard Cost (B)

 $   144,000.00

Standard cost of Actual Hours (A+B)

 $ 155,000.00

Actual Hours Worked

12917

 2.

Statement showing calculation of Actual Purchase Price

Particulars

Amount

Standard unit price of material

 $             5.00

Actual Quantity purchased and used

2000

Standard Quantity allowed for actual production

1800

Material Purchase price variance (favorable) (A)

 $       4,000.00

Standard Costs of actual quantity (B)

 $     10,000.00

Actual Costs (B-A)

 $     6,000.00

Actual Purchase price

 $            3.00

Needles, Powers & Crosson, (2013) opine that there are several reasons for calculation of variances. Variances can be considered as very useful in case of planning of production for the different organizations. With the help of measurement of variances, costs can be appropriately controlled.

Material price variance is the difference between standard price and actual price of material. If actual price of the variance is more, then, it can be considered as unfavorable condition for the organization. Due to this reason, material price variance can be considered as useful for the organizations (Henri, Boiral & Roy, 2016).

Overhead variance analysis helps to calculate the total variance of indirect expenses over the budgeted one. It helps to control indirect expenses in an effective manner (Liu & Kuang, 2014).

Conclusion

It can be concluded that variance analysis can be considered as extremely useful for the organizations. In addition to this, variance analysis helps to control costs and improve efficiency and productivity of the organization

5A.

Calculation of Budget

Particulars

Mar-31

Jun-30

Sep-30

Total

Opening inventory

47890

42000

42000

131890

Purchase

64610

72873.6

71673.6

209157.2

Closing Inventory

42000

42000

42000

126000

Cost of goods sold

70500

72873.6

71673.6

215047.2

Sales( Cash + Credit)

117500

121456

119456

358412

Gross Profit

47000

48582.4

47782.4

143364.8

Budgeting can be considered as non-technical process. It helps to estimating total amount of expenses for a particular period of time in future. The process of budgeting can be considered as a blue print of the organization in order to make maximum efficiency for the organization. In addition to this, it can be inferred that the role of budgetary analysis is extremely pivotal for the success of the organization. In addition to this, budgetary method helps to integrate different management activities through different types of technical aspects. On the other hand, it can be also inferred that, budgetary process can also be considered as a political process. This is mainly because, Governments also get involved into budgetary analysis by abiding by different revenue and fiscal policies for the different economies. However, it can be also inferred that most of the modern organizations considers the process of budgeting to accomplish their short term and long term goals and objectives.  For this reason, the role of budgeting plays a pivotal role for most of the organizations (Drury, 2013). 

The above cartoon image shows the process of budget in a humorous manner. The management of the organization is about to plan for the budget throughout the night in order to plan effectively. This has been shown in this manner.

References

Drury, C. M. (2013). Management and cost accounting. Springer.

Henri, J. F., Boiral, O., & Roy, M. J. (2016). Strategic cost management and performance: The case of environmental costs. The British Accounting Review, 48(2), 269-282

Liu, Y., & Kuang, Y. (2014). The Establishment of Management Accounting System in Administrative Institutions. Journal of Accounting and Economics, 2, 003.

Melnyk, S.A., Bititci, U., Platts, K., Tobias, J. & Andersen, B., (2014). Is performance measurement and management fit for the future?. Management Accounting Research, 25(2), pp.173-186

Needles, B. E., Powers, M., & Crosson, S. V. (2013). Financial and managerial accounting. Nelson Education.

Cite This Work

To export a reference to this article please select a referencing stye below:

My Assignment Help. (2022). Cost Accounting: Job Costing, Equivalent Units, And Joint Cost Allocation. Retrieved from https://myassignmenthelp.com/free-samples/accting2500-cost-and-management-accounting/closing-stock-of-raw-material-file-E8956D.html.

"Cost Accounting: Job Costing, Equivalent Units, And Joint Cost Allocation." My Assignment Help, 2022, https://myassignmenthelp.com/free-samples/accting2500-cost-and-management-accounting/closing-stock-of-raw-material-file-E8956D.html.

My Assignment Help (2022) Cost Accounting: Job Costing, Equivalent Units, And Joint Cost Allocation [Online]. Available from: https://myassignmenthelp.com/free-samples/accting2500-cost-and-management-accounting/closing-stock-of-raw-material-file-E8956D.html
[Accessed 05 October 2024].

My Assignment Help. 'Cost Accounting: Job Costing, Equivalent Units, And Joint Cost Allocation' (My Assignment Help, 2022) <https://myassignmenthelp.com/free-samples/accting2500-cost-and-management-accounting/closing-stock-of-raw-material-file-E8956D.html> accessed 05 October 2024.

My Assignment Help. Cost Accounting: Job Costing, Equivalent Units, And Joint Cost Allocation [Internet]. My Assignment Help. 2022 [cited 05 October 2024]. Available from: https://myassignmenthelp.com/free-samples/accting2500-cost-and-management-accounting/closing-stock-of-raw-material-file-E8956D.html.

Get instant help from 5000+ experts for
question

Writing: Get your essay and assignment written from scratch by PhD expert

Rewriting: Paraphrase or rewrite your friend's essay with similar meaning at reduced cost

Editing: Proofread your work by experts and improve grade at Lowest cost

loader
250 words
Phone no. Missing!

Enter phone no. to receive critical updates and urgent messages !

Attach file

Error goes here

Files Missing!

Please upload all relevant files for quick & complete assistance.

Plagiarism checker
Verify originality of an essay
essay
Generate unique essays in a jiffy
Plagiarism checker
Cite sources with ease
support
close