Chapter_15_Lecture_Notes

Job Order Costing

A cost accounting system specialized for manufacturing that collects production costs and assigns them to products.

Cost Accounting System

A system that tracks costs in a business, specifically in manufacturing, where costs are collected and assigned to specific products.

Job Cost Sheet

A document that records direct materials, direct labor, and estimated overhead for each job, used to track costs separately.

Materials Ledger Card

A record maintained in the raw materials warehouse that tracks the number of units and pricing of parts.

Receiving Report

A document that tracks goods received and inspected at the loading dock, serving as a source document for purchases of raw materials.

Direct Materials Used Entry

An accounting entry where Work In Progress (WIP) is debited and Raw Materials (RM) is credited.

Factory Overhead (FOH)

All factory-related costs that are not directly tied to a specific job, including indirect materials, indirect labor, utilities, and depreciation.

Predetermined Overhead Rate

The rate calculated by dividing total estimated overhead costs by total estimated activity base, used to allocate factory overhead to jobs.

Time Cards

Documents that record total time worked by laborers during their shifts, used to track direct labor.

Completed Job Entry

The accounting entry made when a job is finished, involving a debit to Finished Goods (FG) and a credit to Work In Progress (WIP).