305 Midterm Chapter 3 Flashcards
What are the 5 cost flow sections?
(1) Raw material inventory
(2) Factory Labor
(3) MOH
(4) WIP Inventory
(5) Finished Goods Inventory
what are the Steps + formulas to calculate MOH Applied (chapter 3 questions)
Step 1: Calculate your predetermined MOH Rate (PMOH)
PMOH: (estimated MOH)/(Expected Activity)
Step 2: Calculate the Apply MOH based on actual amounts
AMOH: PMOH * Actual Activity Used
Step 3: Make adjustment
Adjustment: Actual MOH - Applied MOH = (+) increase COGS, OR, (-) Decrease COGS
Adjustment of MOH COGS Methods for (1) Under, (2), Over
Under: Debit COGS, Credit MOH
Over: Debit MOH, Credit COGS
When would you use COGS method vs Proration Method?
COGS Method is Immaterial (not a lot of money)
Proration Method is Material (A lot of money)
What information do you need to make a Job Cost Sheet?
Job Cost Sheet
BWIP
DM Used
DL
AMOH
——————
= Total Cost
/ Units Produced
——————
= Cost per unit
What information do you need to make a Normal costing income statement?
Normal Costing Income Statement
Sales
Unadjusted COGS
+BFG
+COGM
-EFG
————-
= Unadjusted COGS
Under applied (+) or (-) over applied
—————
= Adjusted COGS
= Gross Profit
- Period Expenses
————————-
= Operating income
- Taxes (OI x Tax Rate)
= Net Income
What steps are required to job order costing questions?
Step 1. Calculate the PMOH
PMOH: (estimated MOH)/(Expected Activity)
Step 2. Prepare Job Cost sheet for JCS - Unfinished or Started Sheet
BWIP (DM + DL + (DL * PMOH))
DM
DL
AMOH (DL * PMOH)
———-
TC
Status
& JCS - Jobs in BGF
DM
DL
AMOH
TC
Step 3. Status
A) For jobs that are unfinished or just started:
1. Complete = COGM –> ( Sold = COGS or Not Sold = EFG)
2. Unfinished = EWIP
Step 4. Answer Questions
How do you calculate the adjusted COGS
Add the COGS sums from job cost sheet + (Underapplied AMOH - Overapplied AMOH)
P = Predetermined = ?
BUDGETED VALUES ONLY
If applied overhead is allocated to inventory vs not allocated, which methods do you use?
Allocated = Proration
Not allocated = COGS
What is another term for requisitions?
Materials used (DM used + Indirect used)
AMOH formula
AMOH = PMOH *Actual DL
When AMOH is given, use it to work backwards to find PMOH or Actual DL
When calculating algebra from a T score, Add everything on the [. ] and subtract everything from the [. ]
Left, Right
In regards to Factory Labour, how do you calculate factory wages & wages assignned?
DL + IL. Both are the same answer
BWIP = $0 if job [. ]
started
How do you calculate is the overhead over or under applied?
MOH
Actual Applied
Factory Rent X X
Factory Supplies X
Indirect Labor X
= SUM
Under or over?
How do you prepare a COGS Schedual?
UCOGS
+ Underapplied MOH
ACOGS
When asked the selling price given a % markup, what is the formula you use?
Selling Price = Cost of Job * (1+Markup%)
When asked what is the net income for the year, what do you use to solve?
Normal Costing Income Statement
DM + DL + AMOH From previous periods is what concept?
BWIP
What is the formula to Calculate the adjusted gross profit?
Sales(UCOGS*%) - ACOGS = GP
What is the formula for calculating accounts payable
Beg AP (account payable)
+ Purchases RM
- Cash Payments
————————-
= End AP
What is the formula for calculating Raw Material
Beg RM
+ Purchases RM
- RM Used (DM Used + IM Used)
————————
= End RM
