Kamis, September 15, 2016

Akmen - Job Order Costing



JOB-ORDER COSTING


Exercise 5-44 Direct Method of Support Department Cost Allocation

a.       Calculate the allocation ratios for Power and General Factory
                                                                                          Battery                       Small Motors
Power                    :     7,000/(7,000+1,000)                     0.875                                      -
                                    1,000/(7,000+1,000)                          -                                      0.125
General Factory    :   5,000/(5,000+15,000)                       0.25                                      -
                                15,000/(5,000+15,000)                         -                                         0.75

b.      Allocate the Support Services Cost to the Operating Divisions                                                                                                        

Support Departments

Operating Divisions


Power
General
Factory


Battery
Small
Motors
Overhead Cost
    $   160,000
$    430,000

$   163,000
$   84,600
Power
(160,000)
-

140,000
20,000
General Factory
-
(430,000)

107,500
322,500

0
0

410,500
427,100

c.       Assume Divisonal Overhead Rates are based on Direct Labor Hours. Calculate the Overhead Rate for the Battery Division and for the Small Motors Divisions.

·         Overhead Rate for the Battery Division                     =   163,000      =  9.06 per DLH
       18,000

·         Overhead Rate for the Small Motors Divisions          =   84,600        = 1.42 per DLH
     60,000





Problem 5-50 Overhead Rates, Unit Costs
                                                  Welding        Assembly       Finishing               Total
Estimates Overhead                $ 220,000        $   62,000        $ 150,000             $ 432,000
Direct Labor Hours                        4,500             10,000             20,500                  20,500
Direct Labor Cost                        90,000           150,000           360,000                360,000
Machine Hours                               5,000               1,000               8,000                    8,000


                                                              Job 1                 Job 2


Direct Materials                                  $ 6,725            $   9,340
Direct Labor Cost                                  1,800                 3,100
Direct Labor Hours                
            Welding                                          10                      10
            Assembly                                        60                      20
            Finishing                                         20                      70
Number of Machine Hours
            Welding                                          50                      50
            Assembly                                        60                      25
            Finishing                                         90                    125


Total                                                   $ 8,825            $ 12,740





1.      Calculate a plantwide rate for Folsom Company Based on machine hours. What is the bid price of each job using this rate?
Plantwide rate for Folsom Company Based on machine hours:

    Machine Hours__  =    $  8,000  = $0.4 per Direct Labor Hours
Direct Labor Hours          $20,500
                
Bid price of the Job 1 = Total Manufacturing Cost + (Typical Bid Price) (Departement Overhead Rates)
                                   =    $ 8,825   +   ( $ 8,825 x 35%) ( 0.4 )
                                   =    $ 8,825   +   ( $ 3,089 ) ( 0.4 )
                                   =    $ 8,825   +     $ 1,236
                                   =    $ 10,061
Bid price of the Job 2 = Total Manufacturing Cost + (Typical Bid Price) (Departement Overhead Rates)
                                   =    $ 12,740   +   ( $ 12,740 x 35% )  ( 0.4 )
                                   =    $ 12,740   +   ( $ 4,459 ) ( 0.4 )
                                   =    $ 12,740   +     $ 1,784
                                   =    $ 14,524

2.      Calculate departmental overhead rates for the producing departments. What is the bid price of each job using these rates?          
Departmental overhead rates for the producing departments:

Estimated Overhead  =  $ 43,200 = 2.10 per Direct Labor Hours
Direct Labor Hours        $ 20,500
                
Bid price of the Job 1 = Total Manufacturing Cost + (Typical Bid Price) (Departement Overhead Rates)
                                   =    $ 8,825   +   ( $ 8,825 x 35%) ( 2.10 )
                                   =    $ 8,825   +   ( $ 3,089 ) ( 2.10 )
                                   =    $ 8,825   +     $ 6,489
                                   =    $ 15,331

Bid price of the Job 2 = Total Manufacturing Cost + (Typical Bid Price) (Departement Overhead Rates)
                                   =    $ 12,740   +   ( $ 12,740 x 35%)  ( 2.10 )
                                   =    $ 12,740   +   ( $ 4,459 ) ( 2.10 )
                                   =    $ 12,740   +     $ 9,364
                                   =    $ 22,104

Problem 5-54 Predetermined Overhead Rates, Variances, Cost Flows
1.      Assuming that overhead is applied on the basis of direct labor cost, what was the overhead rate used during the first quarter of the year?
Applied Overhead      = Direct Labor Cost x Overhead Rate
$ 140,000                     = $ 80,000 x Overhead Rate
Overhead Rate                         = $ 140,000 / $ 80,000
Overhead Rate                          = 1.75 atau 175 %

2.      What was the applied overhead for the first quarter? The actual overhead? The under or overapplied overhead?
     Applied Overhead                  = $ 140,000
     Actual Overhead                     = $ 138,500
     Overlapplied Overhead           = $     1,500

3.      What was the cost of the goods manufactured for the quarter?
Direct materials                                        $   40,000
Direct labor                                                   80,000
Overhead applied                                        140,000
                                                                    260,000
Add: Beginning work in process                  17,000
Less: Ending work in process                  (   32,000)
Cost of goods manufactured                    $ 245,000

4.      Assume that the overhead variance is closed to the cost of goods sold account. Prepare  the journal entry to close out the overhead control account. What is the adjusted balance in Cost if Goods Sold?
Overhead Control                                                $     1,500
Cost of Goods Sold                                        1,500
Adjusted cost of goods sold:                      210,000
                                                       (  1,500)
                                                                  $ 208,500

5.      For Job 32, identify the costs incurred for direct materials, direct labor, and overhead.
Direct Materials ($32,000 – $10,000 – $17,500)              $   4,500
Direct Labor (1,000 × $10)                                                  10,000
Overhead Applied (175% × $10,000)                                 17,500
Ending work in process                                                    $ 32,000




Problem 5-58 Support Department Cost allocation: Comparison of Methods of Allocation    


Support Departments
Producing Departments
Maintenance
Power
Drilling
Assembly
Overhead costs
 $     320,000
 $    400,000
 $          163,000
 $          90,000
Machine hours
-
         22,500
               30,000
               7,500
Kilowatt-hours
         40,000
-
               36,000
           324,000
Direct labor hours
-
-
                 5,000
             40,000

1.      Prepare bids for Bender by using each of the following allocation methods (allocation power costs first)
a.      Direct Method

Drilling
Assembly
Machine : 30,000/(30,000+7,500)
0.80
-
                 7,500/(30,000+7,500)
-
0.20
Power    : 36,000/(36,000+324,000)
0.10
-
                324,000/(36,000+324,000)
-
0.90



Support Departments
Producing Departments

Maintenance
Power
Drilling
Assembly

Direct costs
 $        320,000
 $      400,000
 $          163,000
 $          90,000

Machine (a)
         (320,000)
 -
             256,000
             64,000

Power (b)
 -
       (400,000)
               40,000
           360,000

Total
$                     0
 $                 0  
 $          459,000
 $        514,000
    
      Catatan :



      (a) Machine: Drilling     : 0.80 x $320,000 = $256,000

                            Assembly : 0.20 x $320,000 = $  64,000

      (b) Power   : Drilling     : 0.10 x $400,000 = $   40,000

                            Assembly : 0.90 x $400,000 = $360,000











·         Department Drilling    : Overhead Rate = $459,000 : 30,000 mhrs = $15.3 per machine hour. Product cost and price :
Prime cost                           $ 18.17
Overhead (3 x $15.3)         $ 45.9       
Total unit cost                     $ 64.07
·         Bid Price = $64.07 x 1.15 = $73.6805

b.      Sequentoal Method

Maintenance
Drilling
Assembly
Machine : 30,000/(30,000+7,500)
-
0.80
-
                 7,500/(30,000+7,500)
-
-
0.20
Power :  40,000/(40,000+36,000+324,000)
0.10
-
-
              36,000/(40,000+36,000+324,000)
-
0.09
-
              324,000/(40,000+36,000+324,000)
-
-
0.81






Support Departments
Producing Departments


Maintenance
Power
Drilling
Assembly

Direct costs
 $       320,000
 $      400,000
 $          163,000
 $          90,000

Machine (a)
        (360,000)
              -
             288,000
             72,000

Power (b)
           40,000
       (400,000)
               36,000
           324,000

Total
 $           -
 $            -  
 $          487,000
 $        486,000
       
        Catatan :




        (a) Machine : Drilling        : 0.80 x ($320,000 + $40,000) = $288,000

                              Assembly     : 0.20 x ($320,000 + $40,000) = $72,000

        (b) Power    : Maintenance : 0.10 x $400,000 = $40,000

                              Drilling         : 0.09 x $400,000 = $36,000

                              Assembly      : 0.81 x $400,000 = $324,00












·         Department Drilling : Overhead Rate = $487,000 : 30,000 mhrs = $16.2333
Prime cost                               $  18.17
Overhead (3x $16.2333)         $  48.6999
Total unit cost                         $  34.4033
·         Bid Price = $34.4033 x 1.15 = $39.5638

  1. Which method most accurately reflects the cost of producting the front-end assemblies, Why?
Metode yang paling akurat menurut saya dalam kasus tersebut adalah metode langsung. Metode langsung adalah metode yang sangat simpel dan cara yang paling mudah untuk mendukug biaya-biaya dalam departemen. Selain itu metode langsung juga tidak saling berpengaruh terhadap biaya yang lain. Metode langsung juga hanya memberikan dukungan biaya terhadap departemen produksi. Sehingga biaya-biaya dalam depertemen pendukung menjadi nol (habis) untuk dialokasikan ke departemen produksi. Selain itu, metode langsung juga memungkinkan untuk mendapatkan keuntungan yang lebih besar, di mana harga yang ditawarkan lebih tinggi dibandingkan dengan metode percontohan. Hal ini sebabkan karena dalam metode langsung, biaya dalam departemen pendukung (power dan machine) dialokasikan secara keseluruhann ke departemen produksi, sementara dalam metode bertahap, biaya power dalam departemen pendukung dialokasikan terlebih dahulu ke departemen pendukung (machine) dan ke depertemen produksi (grinding dan assembly) kemudian deprtemen pendukung (biaya machine) dialokasikan ke departemen produksi (grinding dan assembly).

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