Manerial accounting 11e garrison noreen brewer chap003

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Manerial accounting 11e garrison noreen brewer chap003

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11th Edition Chapter McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Systems Design: Job-Order Costing Chapter Three McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Types of Product Costing Systems Process Costing Job-order Costing  A  A company company produces produces many many units units of of aa single single product product  One  One unit unit of of product product is is indistinguishable indistinguishable from from other other units units of of product product  The  The identical identical nature nature of of each each unit unit of of product product enables enables assigning assigning the the same same average average cost cost per per unit unit McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Types of Product Costing Systems Process Costing Job-order Costing  A  A company company produces produces many many units units of of aa single single product product Example companies:  unit is Weyerhaeuser (paper manufacturing) from  1.One One unit of of product product is indistinguishable indistinguishable from other of other2.units units of product product Reynolds Aluminum (refining aluminum ingots)  Coca-Cola bottling beverages) identical nature of unit  3.The The identical(mixing nature and of each each unit of of product product enables enables assigning assigning the the same same average average cost cost per per unit unit McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Types of Product Costing Systems Process Costing     Job-order Costing Many Many different different products products are are produced produced each each period period Products Products are are manufactured manufactured to to order order   The The unique unique nature nature of of each each order order requires requires tracing tracing or or allocating allocating costs costs to to each each job, job, and and maintaining maintaining cost cost records records for for each each job job McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Types of Product Costing Systems Process Costing     Job-order Costing Many Many different different products products are are produced produced each each period period Example companies: Products Products are are manufactured manufactured to to order order Boeing (aircraft manufacturing)  unique nature order requires tracing  2.The The unique nature of of each each order requires tracing or or Bechtel International (large scale construction) allocating costs to each job, and maintaining cost allocating costs to each job, and maintaining cost Walt Disney Studios (movie production) records for each job records for each job McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Comparing Process and Job-Order Costing McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  Which Which of of the the following following companies companies would would be be likely likely to to use use job-order job-order costing costing rather rather than than process process costing? costing? a a Scott Scott Paper Paper Company Company for for Kleenex Kleenex b b Architects Architects c c Heinz Heinz for for ketchup ketchup d d Caterer Caterer for for aa wedding wedding reception reception e e Builder Builder of of commercial commercial fishing fishing vessels vessels McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  Which Which of of the the following following companies companies would would be be likely likely to to use use job-order job-order costing costing rather rather than than process process costing? costing? a a Scott Scott Paper Paper Company Company for for Kleenex Kleenex b b Architects Architects c c Heinz Heinz for for ketchup ketchup d d Caterer Caterer for for aa wedding wedding reception reception e e Builder Builder of of commercial commercial fishing fishing vessels vessels McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Direct Manufacturing Costs Direct DirectMaterials Materials Direct Direct Labor Labor Manufacturing Manufacturing Overhead Overhead McGraw-Hill/Irwin Job JobNo No.11 Job JobNo No.22 Job Job No No.33 Charge Charge direct direct material material and and direct direct labor labor costs costs to to each each job job as as work work is is performed performed Copyright © 2006, The McGraw-Hill Companies, Inc Predetermined Overhead Rate and Capacity Calculating Calculating predetermined predetermined overhead overhead rates rates using using an an estimated, estimated, or or budgeted budgeted amount amount of of the the allocation allocation base base has has been been criticized criticized because: because: 1 Basing Basing the the predetermined predetermined overhead overhead rate rate upon upon budgeted budgeted activity activity results results in in product product costs costs that that fluctuate fluctuate depending depending upon upon the the activity activity level level 2 Calculating Calculating predetermined predetermined rates rates based based upon upon budgeted budgeted activity activity charges charges products products for for costs costs that that they they do not not use use McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Capacity-Based Overhead Rates Criticisms Criticisms can can be be overcome overcome by by using using estimated estimated total total units units in in the the allocation allocation base base at at capacity capacity in in the the denominator denominator of of the the predetermined predetermined overhead overhead rate rate calculation calculation Let’s look at the difference! McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc An Example Equipment is leased for $100,000 per year Running at full capacity, 50,000 units may be produced The company estimates that 40,000 units will be produced and sold next year What is the predetermined overhead rate? McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc An Example Equipment is leased for $100,000 per year Running at full capacity, 50,000 units may be produced The company estimates that 40,000 units will be produced and sold next year What is the predetermined overhead rate? McGraw-Hill/Irwin Traditional = Method $100,000 40,000 = $2.50 per unit Capacity Method $100,000 50,000 = $2.00 per unit = Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  Crest Crest Winery Winery in in Woodinville Woodinville leases leases an an automatic automatic corking corking machine machine for for $100,000 $100,000 per per year year IfIf run run at at full full capacity, capacity, itit can can cork cork 50,000 50,000 cases cases of of wine wine per per year year The The company company estimates estimates 40,000 40,000 cases cases of of wine wine will will be be produced produced and and sold sold next next year year What What is is the the predetermined predetermined overhead overhead rate rate based based on on the the estimated estimated number number of of cases cases of of wine? wine? a a $2.00 $2.00 per per case case b b $2.50 $2.50 per per case case c c $4.00 $4.00 per per case case McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  Crest Crest Winery Winery in in Woodinville Woodinville leases leases an an automatic automatic corking corking machine machine for for $100,000 $100,000 per per year year IfIf run run at at full full capacity, capacity, itit can can cork cork 50,000 50,000 cases cases of of wine wine per per year year The The company company estimates estimates 40,000 40,000 cases cases of of wine wine will will be be produced produced and and sold sold next next year year What What is is the the predetermined predetermined overhead overhead rate rate based based on on the the estimated estimated number number of of cases cases of of wine? wine? a a $2.00 $2.00 per per case case b b $2.50 $2.50 per per case case c c $4.00 $4.00 per per case case McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  Crest Crest Winery Winery in in Woodinville Woodinville leases leases an an automatic automatic corking corking machine machine for for $100,000 $100,000 per per year year IfIf run run at at full full capacity, capacity, itit can can cork cork 50,000 50,000 cases cases of of wine wine per per year year The The company company estimates estimates 40,000 40,000 cases cases of of wine wine will will be be produced produced and and sold sold next next year year What What is is the the predetermined predetermined overhead overhead rate rate based based on on the the number number of of cases cases of of wine wine at at capacity? capacity? a a $2.00 $2.00 per per case case b b $2.50 $2.50 per per case case c c $4.00 $4.00 per per case case McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  Crest Crest Winery Winery in in Woodinville Woodinville leases leases an an automatic automatic corking corking machine machine for for $100,000 $100,000 per per year year IfIf run run at at full full capacity, capacity, itit can can cork cork 50,000 50,000 cases cases of of wine wine per per year year The The company company estimates estimates 40,000 40,000 cases cases of of wine wine will will be be produced produced and and sold sold next next year year What What is is the the predetermined predetermined overhead overhead rate rate based based on on the the number number of of cases cases of of wine wine at at capacity? capacity? a a $2.00 $2.00 per per case case b b $2.50 $2.50 per per case case c c $4.00 $4.00 per per case case McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  When When capacity capacity is is used used in in the the denominator denominator in in the the predetermined predetermined rate, rate, what what happens happens to to the the predetermined predetermined overhead overhead rate rate as as estimated estimated activity activity decreases? decreases? a a The The predetermined predetermined overhead overhead rate rate goes goes up up when when activity activity goes goes down down b b The The predetermined predetermined overhead overhead rate rate stays stays the the same; same; itit isis not not affected affected by by changes changes in in activity activity c c The The predetermined predetermined overhead overhead rate rate goes goes down down when when activity activity goes goes down down McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  When When capacity capacity is is used used in in the the denominator denominator in in the the predetermined predetermined rate, rate, what what happens happens to to the the predetermined predetermined overhead overhead rate rate as as estimated estimated activity activity decreases? decreases? a a The The predetermined predetermined overhead overhead rate rate goes goes up up when when activity activity goes goes down down b b The The predetermined predetermined overhead overhead rate rate stays stays the the same; same; itit isis not not affected affected by by changes changes in in activity activity c c The The predetermined predetermined overhead overhead rate rate goes goes down down when when activity activity goes goes down down McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  When When estimated estimated activity activity is is used used in in the the denominator denominator in in the the predetermined predetermined rate, rate, what what happens happens to to the the predetermined predetermined overhead overhead rate rate as as estimated estimated activity activity decreases? decreases? a.The a.The predetermined predetermined overhead overhead rate rate goes goes up up when when activity activity goes goes down down b.The b.The predetermined predetermined overhead overhead rate rate stays stays the the same; same; itit isis not not affected affected by by changes changes in in activity activity c.The c.The predetermined predetermined overhead overhead rate rate goes goes down down when when activity activity goes goes down down McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Quick Check  When When estimated estimated activity activity is is used used in in the the denominator denominator in in the the predetermined predetermined rate, rate, what what happens happens to to the the predetermined predetermined overhead overhead rate rate as as estimated estimated activity activity decreases? decreases? a.The a.The predetermined predetermined overhead overhead rate rate goes goes up up when when activity activity goes goes down down b.The b.The predetermined predetermined overhead overhead rate rate stays stays the the same; same; itit isis not not affected affected by by changes changes in in activity activity c.The c.The predetermined predetermined overhead overhead rate rate goes goes down down when when activity activity goes goes down down McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc Basing the rate on capacity Actual volume Selling price Variable production cost Fixed manufacturing overhead Capacity Predetermined overhead rate Fixed selling and admin expense Revenue Cost of goods sold Gross margin Cost of idle capacity Selling and admin expense Net operating income McGraw-Hill/Irwin 40,000 $40.00 $24.00 $100,000 50,000 $2.00 $500,000 cases per case per case per year cases per case per year $ 1,600,000 1,040,000 560,000 20,000 500,000 $ 40,000 Copyright © 2006, The McGraw-Hill Companies, Inc Basing the rate on expected volume Actual volume Selling price Variable production cost Fixed manufacturing overhead Expected volume Predetermined overhead rate Fixed selling and admin expense Revenue Cost of goods sold Gross margin Cost of idle capacity Selling and admin expense Net operating income McGraw-Hill/Irwin 40,000 $40.00 $24.00 $100,000 40,000 $2.50 $500,000 cases per case per case per year cases per case per year $ 1,600,000 1,060,000 540,000 500,000 $ 40,000 Copyright © 2006, The McGraw-Hill Companies, Inc End of Chapter McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc

Ngày đăng: 30/11/2016, 11:06

Mục lục

  • PowerPoint Presentation

  • Chapter Three

  • Types of Product Costing Systems

  • Slide 4

  • Slide 5

  • Slide 6

  • Comparing Process and Job-Order Costing

  • Quick Check 

  • Slide 9

  • Direct Manufacturing Costs

  • Slide 11

  • Job-Order Cost Accounting

  • Materials Requisition Form

  • Slide 14

  • Employee Time Ticket

  • Slide 16

  • Why Use an Allocation Base?

  • Manufacturing Overhead Application

  • The Need for a POHR

  • Application of Manufacturing Overhead

  • Overhead Application Rate

  • Slide 22

  • Slide 23

  • Interpreting the Average Unit Cost

  • Slide 25

  • Slide 26

  • Job-Order Costing Document Flow Summary

  • Slide 28

  • Slide 29

  • Slide 30

  • Slide 31

  • Job-Order System Cost Flows

  • Slide 33

  • Cost Flows – Material Purchases

  • Cost Flows – Material Usage

  • Slide 36

  • Cost Flows – Labor

  • Slide 38

  • Cost Flows – Actual Overhead

  • Slide 40

  • Cost Flows – Overhead Applied

  • Nonmanufacturing Cost Flows

  • Slide 43

  • Slide 44

  • Cost Flows – Cost of Goods Manufactured

  • Slide 46

  • Cost Flows – Sales

  • Defining Under- and Overapplied Overhead

  • Overhead Application Example

  • Slide 50

  • Slide 51

  • Slide 52

  • Disposition of Under- or Overapplied Overhead

  • Slide 54

  • Allocating Under- or Overapplied Overhead Between Accounts

  • Slide 56

  • Slide 57

  • Overapplied and Underapplied Manufacturing Overhead - Summary

  • Slide 59

  • Slide 60

  • Multiple Predetermined Overhead Rates

  • Job-Order Costing in Service Companies

  • The Use of Information Technology

  • Appendix 3a

  • Predetermined Overhead Rate and Capacity

  • Capacity-Based Overhead Rates

  • An Example

  • Slide 68

  • Slide 69

  • Slide 70

  • Slide 71

  • Slide 72

  • Slide 73

  • Slide 74

  • Slide 75

  • Slide 76

  • Basing the rate on capacity

  • Basing the rate on expected volume

  • End of Chapter 3

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