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Job Order Costing for Businesses

The document summarizes key aspects of a job order costing system used by manufacturing companies. It discusses how raw material inventory, work in progress inventory, and finished goods inventory accounts are used to track costs. Manufacturing overhead costs like repairs and property taxes are recorded periodically and allocated to jobs. Time tickets and job order sheets are source documents used to assign direct labor and material costs to specific jobs.

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Femy Demetria
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219 views1 page

Job Order Costing for Businesses

The document summarizes key aspects of a job order costing system used by manufacturing companies. It discusses how raw material inventory, work in progress inventory, and finished goods inventory accounts are used to track costs. Manufacturing overhead costs like repairs and property taxes are recorded periodically and allocated to jobs. Time tickets and job order sheets are source documents used to assign direct labor and material costs to specific jobs.

Uploaded by

Femy Demetria
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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Business- Audit Firm, Law Firm,

hospitals, printing press, ship bldg Factory Labour Cost-


companies, aircraft companies salary & Benefits factory
workers

RM Invty control account


summarizes the detailed
data (Sub ledger) regarding
specific inventory accounts
in the subsidiary ledger.

Cost assign each job  0or atch; to


compute cost per job

Job Order Cost Mftg. Cost- WIP Invtry- FG Invtry- COGS


System- 
Manufacturing Cost MOH records daily ex. machinery repairs, inDM/DL
Records periodically- property taxes, deprn
insurance; Controlled Acct.
Job Order Sheet-specific job, total & Unit cost IF assigned in WIP; Debit to WIP Inty; Credit to
completed; Summarize Jost complted (transferred to RM, FL, MOH
FG to await sale) & not completed at the end of acctg.
period Documents
Source
Material Requisation Slip-authorisation issue RM
Source documents posting Job Cost sheet & WIP
Inty

Time Tickets- include Emp. name,


hrs worked, acct, Job chared, total
Labour cost

Predetermined OH rate= Estimated annual OH


cost/Est. Activity level (allocation Base)

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