Learn about “System Design: Job-Order Costing” HOANG PHAT CO.,LTD Instructors : Tran Dinh Khoi Nguyen Subjects : Management Accounting Member's name Nguyen Thi Thanh Huong Le Thi My Le Le Thi Huong Nguyen Huu Khanh Content Overview HOANG PHAT CO., LTD Features and production process of the product Cost estimation JOB ORDER COSTING Cost accounting and cost analysis Overview HOANG PHAT CO., LTD  HOANG PHAT CO., LTD is a Non-state enterprise  Business activities: Producing and processing agricultural and forest products - export  Products: indoor and outdoor furniture; product pageinterior and wooden products JOB ORDER COSTING Features and production process of the product a) Features of the product •) Wood resources are plentiful and diverse species •) High durability, aesthetics diversity, many models  High durability, aesthetics diversity, many models JOB ORDER COSTING b Process manufacturing technology products Round logs Step Sawing wood Step Scarfing Step Boiled Step Drying Step Step Sawing Step Draw, drill, chisel Assembly Step Sanding Step KCS1 Step 10 Oil dip Step 11 KCS2 Step 12 packed and wrapped  Step 13 Step 14 Finished products warehouse JOB ORDER COSTING Cost estimation a) Cost estimate of raw materials directly ) The company estimates the cost of raw materials directly is expenditure chemical and packaging the cost of wood materials, auxiliary materials, JOB ORDER COSTING Cost estimation b) Cost estimate of direct labor cost ) Based on the quantity of products produced according to the estimates and norms of direct labor cost for a product JOB ORDER COSTING Cost estimation c) Application manufacturing overhead ) The general production cost estimate includes the cost estimate: Expenses for workshop staff, material costs, equipment costs,export, depreciation costs, costs of services purchased from outside, other costs JOB ORDER COSTING Cost Estimation d) Estimated cost of sales and management costs of the company ) Estimates of selling expenses and management expenses of the Company are based on the previous period's data and the fluctuation of the plan period Then allocate to each order in the year according to the volume of production estimates Click Clickicon iconto toadd addpicture picture Employee Time Ticket *The estimated level of activity depends on the business characteristics of each business karma to choose, may be the direct labor hours of workers, cost direct materials, direct labor costs * Application of manufacturing overhead The predetermined overhead rate(POHR) used to apply overhead to jobs is determined before the period begins POHR= Estimated total manufacturing overhead cost for the coming period / Estimated total units in the allocation base for the coming period *Example : Hoang Phat CO., LTD Required $300 of direct materials and 10 direct labor hours at $ 15 per hours Estimated total overhead for the year was $800,000 and estimated direct labor hours were 25,000 What would be recorded as the cost of job Hoang Phat CO., LTD? POHR=$800,000/25,000=$32 Direct materials $300 Direct labor $15x10 hours $150 Manufacturing overhead $32x10 hours $ 320 Total cost $770 JOB ORDER COSTING Cost accounting and cost analysis  Company operating production and business according to the orders, so the Company applies the method of determining expenditures work fee or the orders  The cost of production of the company is each order  Cost analysis object is the completed orders in accordance with the technical design