COST ACCOUNTING
JOB ORDER COSTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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from time tickets
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from the work in process inventory account
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by adding direct materials used, direct labour incurred and manufacturing overhead incurred
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from the cost of goods sold account
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Detailed explanation-1: -In order to calculate COGM, just add the Beginning WIP Inventory to the Total Manufacturing Cost, and subtract the Ending WIP Inventory. This will give you the total cost of the goods that were finished during the specified period. Read more about Work in Process Inventory Accounting.
Detailed explanation-2: -Average cost method assigns a cost to inventory items based on the total cost of goods purchased or produced in a period divided by the total number of items purchased or produced.
Detailed explanation-3: -Once a job is completed, the total costs assigned to the job are transferred from work‐in‐process inventory to finished goods inventory. Once the job is sold and delivered, the job costs are transferred from finished goods inventory to cost of goods sold.