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    Job Costing

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    18FB014 Hridoy Pal
    The documents provide information about job costing, including direct materials, direct wages, overhead costs, and profit percentages. Job cost sheets and estimated statements are presented to calculate costs and selling prices. Overhead rates are calculated as percentages of direct wages or total costs. Selling prices are estimated to yield a target percentage profit on total cost or selling price.

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    Job Costing

    Uploaded by

    18FB014 Hridoy Pal
    12 views4 pages
    The documents provide information about job costing, including direct materials, direct wages, overhead costs, and profit percentages. Job cost sheets and estimated statements are presented to calculate costs and selling prices. Overhead rates are calculated as percentages of direct wages or total costs. Selling prices are estimated to yield a target percentage profit on total cost or selling price.

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    Job costing file

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    Job-Costing-Copy

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    The documents provide information about job costing, including direct materials, direct wages, overhead costs, and profit percentages. Job cost sheets and estimated statements are presented to calculate costs and selling prices. Overhead rates are calculated as percentages of direct wages or total costs. Selling prices are estimated to yield a target percentage profit on total cost or selling price.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    12 views4 pages

    Job Costing

    Uploaded by

    18FB014 Hridoy Pal
    The documents provide information about job costing, including direct materials, direct wages, overhead costs, and profit percentages. Job cost sheets and estimated statements are presented to calculate costs and selling prices. Overhead rates are calculated as percentages of direct wages or total costs. Selling prices are estimated to yield a target percentage profit on total cost or selling price.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 4

    Problem 1

    The following information is given regarding a specific job which passes through three departments: X,
    Y, and Z.

    Departments
    X Y Z
    Materials $ 8000 $ 1000 $ 500
    Direct Labor Hour 1000 2000 5000
    Rate of Direct Labor per hour $1.00 $1.50 $2.00
    Scrap of material sold $1000 $150 $100
    Total overhead for the departments $10,000 $15,000 $25,000
    Total Labor per hour for the departments 10,000 30,000 40,000

    Job Cost Sheet

    Departments

    Materials (Less scrap)


    Dept. X 7,000
    Dept. Y 850
    Dept. Z 400
    8,250
    Direct Wages:
    Dept. X (1000*1) 1000
    Dept. Y (2000*1.5) 3000
    Dept. Z (5000*2) 10000
    14,000
    Overhead
    Dept. X 1000
    Dept. Y 1000
    Dept. Z 3125
    5,125
    Total Cost: 27,375
    Problem 2

    The expenses shown below were incurred for a job during the year ended on 31 March 2019.

    Direct Materials $ 30,000


    Direct Wages $40,000
    Chargeable Expense $10,000
    Factory overhead for the departments $20,000
    Selling overhead $20,000
    Administrative overhead $30,000

    The total price for the above job was $180,000.

    Required: You are required to prepare a statement showing the profit earned from the job during the year
    ended 31 March 2019, as well as an estimated price of a job which is to be executed in the year 2019-20.
    You should charge the same percentage of profit on sales as was the case for the year 2019. Materials,
    wages, and chargeable expenses will be required at $50,000, $70,000, and $20,000, respectively, for the
    job.
    The various overheads should be recovered on the following basis while calculating the estimated price:
     Factory overheads as a percentage of direct wages
     Administrative and selling and distribution overheads as a percentage of factory cost
    Solution:

    Job Cost Sheet


    For the year ended 31 March 2019

    Particulars $
    Direct Materials $ 30,000
    Direct Wages $40,000
    Chargeable Expense $10,000
    Prime Cost $80,000
    Factory overhead for the departments $20,000
    Factory Cost $1,00,000
    Administrative overhead $30,000
    Total Cost of production $1,30,000
    Selling overhead $20,000
    Selling Cost $1,50,000
    Profit $30,000
    Sale Price $1,80,000

    Note: Calculation of overheads rates and percentage of profit on sales as follows:

    a) Factory overhead rate= Factory overhead/ Direct Wages


    = (20,000/40,000)*100
    = 50%
    b) Administrative overhead rate= Administrative overhead /Factory cost
    = (30,000/1,00,000)*100
    = 30%
    c) Selling overhead rate= Selling overhead/ Factory cost
    = (20,000/1,00,000)*100
    = 20%
    d) Profit on sales= Profit/ Selling price
    = (30,000/1,80,000)*100
    = 16.67%
    Estimated Statement for 2020

    Particulars $
    Direct Materials $50,000
    Direct Wages $70,000
    Chargeable Expense $20,000
    Prime Cost $1,40,000
    Factory overhead for the departments (50% on wages) $35,000
    Factory Cost $1,75,000
    Administrative overhead (30% on Factory cost) $52,500
    Cost of production $2,27,500
    Selling overhead (20% on Factory cost) $35,000
    Selling Cost $2,62,500
    Profit $52,500
    Sale Price $3,15,000

    Problem 3: The account of ‘A’ ltd. company shows that-


    $
    Direct materials used 18,000
    Machine labor wages 16,000
    Factory overhead 4,000
    Administrative overhead 1,900

    (a) Show the Factory overhead and Total Cost, the percentages that the Factory overhead cost bears to the
    Machine Labor Wages and the percentage that the Administrative overhead bear to the Factory overhead.
    (b) What price should the Company quote to manufacture a machine which, it is estimated, will require an
    expenditure of Rs.8,000 in material and Rs.6,000 in wages, so that it will yield a profit of 25% on the total
    cost or 20% on the selling price.

    Problem 4: The following direct costs were incurred on Job. No. 212 of ‘P’ Company:
    $
    Direct materials used 4,010
    Direct wages: Dept. A -60 hrs- tk. 3 per hour
    Dept. B -40 hrs- tk. 2 per hour
    Dept. C -20 hrs- tk. 5 per hour
    Overhead Expenses:
    Variable- Dept. A - tk. 5,000 for 5,000 hrs
    Dept. B - tk. 3,000 for 1,500 hrs
    Dept. C - tk. 2,000 for 500 hrs
    Fixed- tk. 20,000 for 10,000 hrs (Normal working
    hours)

    You are required to calculate the cost of Job. No. 212 and calculate the price that yield a profit of 25% on
    the selling price.

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