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Accounting For Foh

This document discusses job order costing and factory overhead. It covers three main product costs: direct materials, direct labor, and factory overhead. It then provides an example cost of goods sold statement for Chubs Company for January 2020. It discusses predetermined factory overhead rates that can be calculated based on direct labor hours, direct labor cost, machine hours, direct material cost, or units of production. Finally, it poses a question calculating predetermined factory overhead rates for Bossing Company based on these different bases.

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Diane Marinel De Leon
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116 views17 pages

Accounting For Foh

This document discusses job order costing and factory overhead. It covers three main product costs: direct materials, direct labor, and factory overhead. It then provides an example cost of goods sold statement for Chubs Company for January 2020. It discusses predetermined factory overhead rates that can be calculated based on direct labor hours, direct labor cost, machine hours, direct material cost, or units of production. Finally, it poses a question calculating predetermined factory overhead rates for Bossing Company based on these different bases.

Uploaded by

Diane Marinel De Leon
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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JOB ORDER COSTING

Accounting for Factory Overhead


Your Classmate, Guia ☺
Three Main Product Cost
1. Materials (DM)
Direct materials
Indirect materials
2. Labor (DL)
Direct labor
Indirect Labor
3. Factory Overhead (FOH)
CHUBS COMPANY
COST OF GOODS SOLD STATEMENT
FOR THE MONTH ENDED JANUARY 31, 2020

DM Direct Materials
Materials, Beginning xx
Purchases x
Less: Purchase returns (x) xx
Total available for use xx
Less: Material, End (x)
Less: Indirect materials (x) xx xx
DL Direct Labor xx
FOH Factory Overhead xx
TMC Total Manufacturing Cost xx
WIPB Add: Work in process, beg. xx
CGPP Cost of goods put into process xx
WIPE Less: Work in process, end (xx)
CGM Cost of goods manufactured xx
FGB Add: Finished goods, beg xx
TGAS Total good available for sale xx
FGE Less: Finished goods, end (xx)
CGS-N Cost of goods sold-normal xx
U/O FOH Add: Underapplied factory overhead xx
CGS-A Cost of goods sold- actual xx
Question:

1. DM + DL = ?
2. DL + FOH = ?
3. DM + DL + FOH = ?
Try Naten i-solve, Classmate!

1. For the month of March 2011, prime cost was?


2. For the month of March 2011, conversion cost was?
3. For the month of March 2011, cost of good manufactured
was?
Ganito Kasi Yon, Classmate!
One More Chance, Classmate!
Did you take the chance, Classmate!
Predetermined OH Rate
1. Based on direct labor hours (DLH)
FOH rate = FOH / DLH

2. Based on direct labor cost (DLC)


FOH rate = FOH / DLC x 100
3. Based on machine hours (MH)
FOH rate = FOH / MH

4. Based on direct material cost (DMC)


FOH rate = FOH / DMC x 100%

5. Units of Production (UP)


FOH rate = FOH/UP
Ang Tanong:
The Bossing Company estimates factory overhead at P450,000
for the next fiscal year. It is estimated that 90,000 units will be
produced at a material cost of P600,000. Conversion will require
an estimated 100,000 direct labor hours at a cost of P3.00 per
hour, with 45,000 machine hours.
Calculate the predetermined FOH rate using the following basis:
1. Direct Material Cost
2. Unit of Production
3. Machine Hours
4. Direct Labor Cost
5. Direct Labor Hours
Allocation of Service Department Cost to
Producing Department
Allocation of Service Department Cost to
Producing Department
Allocation of Service Department Cost to
Producing Department
THANK YOU!
- Your Classmate, Guia ☺

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