Fifth edition Alnoor Bhimani Charles T. Horngren Srikant M. Datar Madhav V. Rajan Farah Ahamed

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3.21 Job costing, accounting for manufacturing overhead, budgeted rates.

8 ab Completed job-cost records
b Debit. Finished goods records Credit. Job-cost record
9 ab Approved sales invoice
b Debit. Customers accounts (or cash) Credit. Sales ledger, if any
10 ab Costed sales invoice
b Credit. Finished goods records
11 ab Special authorisation from the responsible accounting officer
b Subsidiary records are generally not used for these entries
3.21
Job costing, accounting for manufacturing overhead, budgeted rates. (25–30 min.)
1 An overview of the product-costing system is

Budgeted manufacturing overhead divided by allocation base
a Machining overhead
€1,800,000
= €36 per machine-hour
50,000
b
Assembly overhead
€3,600,000
= 180% of direct labour costs
€2,000,000

Bhimani, Horngren, Datar and Rajan, Management and Cost Accounting, 5
th
Edition, Instructor’s Manual
© Pearson Education Limited 2012
2
Machining overhead, 2,000 hours × €36 = €72,000 Assembly overhead, 180% of €15,000 = €27,000 Total manufacturing overhead allocated = €99,000

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