1: Identify the main manufacturing costs of the object and with assumed values create an Income Statement, clearly showing the Schedule of Cost of Goods Manufactured and Cost of Goods Sold for the object for one month.

Question 2: Create a scenario where some of the units produced of the object are spoiled. Using assumed values and identifying them clearly, prepare the journal entries (a) to take the manufacturing costs into production (b) and then record the loss as job-specific cost (c) and then as an overall cost.

Question 3: Using assumed values create a scenario of a modified wage plan for an employee for each working day for a week. Clearly identified the wage plan and units produced. Calculate the employee’s wages and prepare a journal entry to take the labor cost into production.

Question 4: Create a scenario, using assumed values, and distribute the costs from two service departments to two production departments. Calculate the total factory overheads of the production departments.

Question 5: Take part of the production of the chosen object and identify at least 4 different activities undertaken during the production process. Choose an appropriate base for each activity and using assumed values, calculate the Predetermined overhead rate for each activity. Also apply it to calculate the total factory overhead for the product.

Answer rating: 100% (QA)

1 The three general categories of costs included in manufacturing processes are direct materials direct labor and overhead To calculate the cost of goods manufactured you must add your direct materials direct labor and manufacturing overhead to get your businesses total manufacturing cost The calculation of the cost of goods sold for a manufacturing company is Beginning Inventory of Finished Goods Add Cost of Goods Manufactured Equals Finished Goods Available for Sale Subtract Ending Inventory of Finished Goods Equals Cost of Goods Sold The income statement of a manufacturing company is one of the most important financial statements of the company This statement reveals the companys revenues expenses and net profit or loss records for an accounting period The three elements of manufacturing costs are material labour and manufacturing overhead Material A distinction is made between direct materials and indirect materials when the product is the relevant cost objective The Elements of Cost are the three types of product costs labor materials and overhead and period costs Cost of Goods Manufactured COGM is a term used in managerial accounting that refers to a schedule or statement that shows the total production costs for a company during a specific period of time 2 In terms of the formula needed to calculate total manufacturing cost its usually expressed in the following way Total manufacturing cost Direct materials Direct labour Manufacturing overheadManufacturing costs fall into three broad categories of expenses materials labor and overhead All are direct costs That is the salary of the company accountant or the accountants office supplies are not included but the salary and supplies of the foreman are Salaries and wages for quality assurance industrial engineering materials handling factory management and equipment maintenance personnel Using the formula Total job cost Direct materials direct labor applied overhead Jared adds 400 660 36674 to arrive at a total job cost of 142674 This is the amount that Marissa pays Jared for her dining room table Job costing is a costing method used to determine the cost of specific jobs which are performed according to the customers specifications It is a basic costing method which is applicable where work consists of separate projects or contract jobs Overall Cost means per Case of any Product at any time the sum of i the Standard Cost of Materials utilized plus ii Direct Labor Cost plus iii Overhead Cost in each case per Case of such Product in effect at such time 3 The labor cost per unit is obtained by multiplying the direct labor hourly rate by the time required to complete one unit of a product For example if the hourly rate is 1675 and it takes 01 hours to manufacture one unit of a product the direct labor cost per unit equals 168 1675 x 01 To calculate the number multiply the direct labor hourly rate by the number of direct labor hours required to complete one unit As a labor cost example if the direct labor hourly rate is 10 and it takes five hours to complete one unit the direct labor cost per unit is 10 multiplied by five hours or 50 4 The process of redistribution of cost of service departments among production departments on suitable basis is known as secondary distribution In this method the overheads of each service department is allocated only to other service department in the given basis or ratio Thus true overhead cost of each service department is ascertained Thereafter these are distributed to production department To calculate total manufacturing cost you add together three different cost categories the costs of direct materials direct labour and manufacturing overheads The formula for activitybased costing is the cost pool total divided by cost driver which yields the cost driver rate The cost driver rate is used in activitybased costing to calculate the amount of overhead and indirect costs related to a particular activity Thus we have Rate of overhead Total overhead costsTotal direct material ... View the full answer