Assignment Pertemuan 4-Kode Dosen

Name : Kinanthi Sekar Anggaresti
Class : AK-47-07
NIM : 104022330047
PART I
Please answer each question:
1. Define cost pool, cost tracing, cost allocation, and cost-allocation base.
a. Cost Pool
A cost pool is a grouping of individual indirect cost items. It is a collection of
indirect costs that are incurred for the benefit of multiple cost objects, such as
departments products, or services.
b. Cost Tracing
Cost tracing is the process of assigning direct costs to the relevant cost objects.
Direct costs are costs that can be directly attributed to a specific cost object,
such as direct labor or direct materials
c. Cost Allocation
Cost allocation is the assigning of indirect costs to the chosen cost object.
Indirect costs are costs that cannot be directly attributed to a specific cost
object but are necessary for the operation of the business
d. Cost-Allocation Base
A cost-allocation base is a factor that links in a systematic way an indirect cost
or group of indirect costs to cost objects. It is a method used to allocate indirect
costs to cost objects based on a predetermined factor, such as direct labor
hours, machine hours, or sales volume.
2. How does a job-costing system differ from a process-costing system?

A job-costing system and a process-costing system are two different methods used
in cost accounting to track and allocate costs in a business. Job costing, also known
as job order costing, is a method that calculates the cost of each job or project,
where the work is conducted based on the client’s needs and requirements. It is best
suited for industries where products are made per customers’ demands, such as
furniture, interior decoration, and shipbuilding. In job costing, the cost is calculated
after completing the job, and the costs of all labor and materials used in the job are
recorded and compiled. This method is useful for tracking the costs of unique
products or services, where each job is different from another, and there is a need
for individuality in the costing.
The key differences between job costing and process costing include:
o Product Uniqueness
Job costing is best for industries where products are made per customers’
demands, while process costing is best for industries with a vast volume of
similar products.
o Cost Determination
In job costing, the cost is calculated after completing the job, while in process
costing, the cost of each job is determined as the work progresses.
o Losses
In job costing, losses cannot be separated, but with process costing, losses can
be separated.
o Work in progress
With job costing, there may or may not be any work in progress (WIP). With
process costing, there is always WIP at the beginning and end of a period.
o Record keeping
For job costing, keeping records is tedious and time-consuming, but process
costing keeps things streamlined and efficient.
o Industry
Job costing is best for industries where products or services are customized
based on consumer’s demands. Process costing is best for mass production
3. Explain how the cost of a cost object/job is determined under a job-costing system
In a job-costing system, the cost of a cost object or job is determined by tracing the
cost of direct costs to the job and allocating the cost of indirect costs to the job
usign a systematic method. After identifying the cost object, the cost of direct costs
is traced to it. Then, necessary cost-allocation bases are selected for all relevant
indirect costs. The overhead rate is calculated for each cost-allocation base, and
indirect costs associated with each cost-allocation base are allocated to the chosen
cost object. Finally, the total cost of the job is calculated by adding all direct traced
and all indirect costs allocated to the cost object.
4. Describe three major source documents used in job-costing systems.

o Job-cost records or job-cost sheets
These documents record the direct costs of a job, such as direct labor, direct
materials, and direct overhead. They are used to track the costs incurred during
the production process and are essential for determining the cost of a job.
o Materials requisiton forms

These documents authorize the release of materials from the storeroom for use
in a specific job. They are used to track the movement of materials from the
inventory to the job, ensuring that the correct materials are used and that the
costs are properly allocated to the job
o Time tickets
These documents are filled out by employees to record the time they spend on
each job. They are used to track the direct labor costs associated with a job,
ensuring that the correct labor costs are allocated to the job.
5. Distinguish between actual costing and normal costing.

a. Actual costing is a method that adds actual direct material, actual direct labor,
and actua manufacturing overhead costs to the work in process inventory. In
this method, all costs, including overhead, are allocated to the products as
they are incurred. If overhead costs exceed production volume, there is an
accumulation of overhead in the work in process and finished goods inventory
accounts. Under acctual costing, the total manufacturing cost for period is
divided into two parts (variable cost and fixed cost)
b. Normal costing on the other hand is a method that adds actual direct material,
actual direct labor, and applied manufacturing overhead costs to the work in
process inventory. In this method, overhead costs are allocated to products
using predetermined overhead rates based on actual goods produced. This
results in a uniform and realistic overhead rate for all units manufactured
during an accounting year.
6. Describe three different debit entries to the Work-in-Process Control T-account
under normal costing.
a. Direct materials
Debit the work in process control account for the cost of direct materias used
in the production process. This entry represents the cost of the materials that
have been consumed in the production of goods.
b. Direct labor
Debit the work in process control account for the cost of direct labor
associated with the production process. This entry represents the cost of the
labor that has been used to produce the goods.
c. Manufacturing overhead
Debit the work in process control account for the cost of manufacturing
overhead, which includes indirect materials, indirect labbor, and other indirect
costs. This entry represents the cost of the overhead that has been incured in
the production process.
7. Which of the following does not accurately describe the application of job costing?
a. Finished goods that are purchased by customers will directly impact cost of goods
sold.
b. Indirect manufacturing labor and indirect materials are part of the actual
manufacturing costs incurred.
c. Direct materials and direct manufacturing labor are included in total
manufacturing costs.
d. Manufacturing overhead costs incurred is used to determine total manufacturing
costs.
a. Finished goods that are purchased by customers will directtly impact cost of
goods sold. Under job costing, the cost of goods sold is determined by the cost
of the job, which is calculated by adding the direct costs (direct materials and
direct labor) and the indirect costs (manufacturing overhead) allocated to the
job. The cost of the job is not directly impacted by the sale of finished goods to
customers.
PART II
Sturdy Manufacturing Co. assembled the following cost data for job #23:
What are the total manufacturing costs for job #23 if the company uses normal job costing?
Answer:
Total manufacturing costs include Direct materials, direct manufacturing labor, and
manufacturing overhead applied.
Manufacturing overhead ccosts

= Indirect manufacturing labor + Equipment depreciation + Other indirect manufacturing
costs + Indirect materials
= $12.000 + $1.000 + $1.500 + $4.000 = $18.500 + $$2.000 (manufacturing overhead
overapplied) = $20.500
Total manufacturing costs

= $80.000 + $95.000 + $20.500 = $195.000

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Name : Kinanthi Sekar Anggaresti

2. How does a job-costing system differ from a process-costing system?

4. Describe three major source documents used in job-costing systems.

o Materials requisiton forms

5. Distinguish between actual costing and normal costing.

Manufacturing overhead ccosts

Total manufacturing costs

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