Page 5: Job Costing System

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Page 5 Job Costing System

• Gerald
• Katherine
• Armineh

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Document or Report

• May be prepared by hand or printed by a computer

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Off-Page Connector

• An entry from another page
• OR
• An exit to another page

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Display

• Information displayed by an online output device
• Ex Monitor

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Magnetic Disk

• Used for master files and databases
• Shows data stored permanently on a magnetic disk

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Online Keying

• Shows data entry by an online device
• Ex Personal Computer

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Computer Processing

• Shows a computer-performed processing function
• Usually results in a change in data or information

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Auxiliary Operation

• A processing function performed by a device that
  is not a computer

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Job-Order Costing

• The process of tracking the expenses incurred on
  a job against the budget or estimate for that job
• Both direct and indirect costs are assigned to
  each open job
• The advantages of tracking such data is that it
  allows companies to build up a profile of
  projects undertaken, and improve their estimation
  report involved when similar projects are taken

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Production labor transaction file
Data entry and verification
To Payroll
Time Card or Labor Ticket
Time Card or Labor Ticket
Merge
Materials issuance transaction file
Data entry and verification
Materials requisition

• Used for employees paid on an hourly basis
• Records the employees arrival and departure time
  for each work shift
• Includes total hours worked during a pay period

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Production labor transaction file
Time Card or Labor Ticket
Data entry and verification
To Payroll
Merge
Materials issuance transaction file
Data entry and verification
Materials requisition
Materials requisition

• Authorizes the removal of the necessary quantity
  of raw materials from the storeroom to the
  factory location
• Contains
• Production order number
• Date of issue
• Part numbers and quantities of all necessary raw
  materials

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Production labor transaction file
Production labor transaction file
Time Card or Labor Ticket
Data entry and verification
To Payroll
Merge
Materials issuance transaction file
Data entry and verification
Materials requisition
Contains records for production labor during this
period
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Production labor transaction file
Time Card or Labor Ticket
Data entry and verification
To Payroll
Merge
Materials issuance transaction file
Materials issuance transaction file
Data entry and verification
Materials requisition
Contains records for raw materials used during
this period
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Merge
Materials and labor usage report
Production cost transaction file (Actual)
Production cost transaction file (Actual)
Print
Scrap and lost time report

• Contains records for the total production costs
  during this period
• Includes costs for both labor and materials

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Merge
Materials and labor usage report
Materials and labor usage report
Production cost transaction file (Actual)
Print
Scrap and lost time report

• Report showing the amount of labor and materials
  that were used

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Merge
Materials and labor usage report
Production cost transaction file (Actual)
Print
Scrap and lost time report
Scrap and lost time report

• Report showing the amount of labor and materials
  that were lost or wasted

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Production cost transaction file (Actual)

• The costs which are budgeted prior to the
  production of any units the company will sell
• Covers budgeted direct materials, direct
  manufacturing labor, indirect costs, and
  manufacturing overhead

Standard cost file (Budgeted)
Standard cost file (Budgeted)

• Standard cost per unit for each variable
  direct-cost input
• Standard input allowed for one output unit x
  Standard price per input unit

Manufacturing Overhead file (Actual)
Standard cost variance analysis
Overhead analysis
Standard cost variance reports
Overhead residual analysis report
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Production cost transaction file (Actual)
2 Types of Variance

• Compares the budgeted direct-costs of production
  against the actual direct-costs of production as
  well as indirect costs
• Two types of Variance
• Price Variance
• Efficiency Variance

Standard cost file (Budgeted)
Manufacturing Overhead file (Actual)
Overhead analysis
Standard cost variance analysis
Standard cost variance reports
Overhead residual analysis report

• Price Variance
• (Actual Price of input-Budgeted)
• x Actual Quantity of Input

• Efficiency Variance
• (Actual Quantity of input used- Budgeted)
• x Budgeted Price of input

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Production cost transaction file (Actual)

• Compares actual overhead to what has been
  budgeted
• It helps to find the variance between budgeted
  overhead and actual overhead to help determine
  whether this is un/favorable

Standard cost file (Budgeted)
Manufacturing Overhead file (Actual)
Standard cost variance analysis
Overhead analysis
Overhead analysis
Standard cost variance reports
Overhead residual analysis report
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• Pulls the data stored in the production cost
  transaction file, and separately allocates the
  direct materials, direct labor, and indirect
  costs.
• The indirect costs include both indirect
  materials and indirect labor, which are stored in
  the manufacturing overhead file.
• The direct material and direct labor costs are
  stored individually.

Production cost transaction file (Actual)
Cost Distribution
Direct Material File (Actual)
Direct Labor File (Actual)
Manufacturing Overhead File (Actual)
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Pulls the stored data from the manufacturing
overhead, direct material and direct labor files
and applies the data to the open job file.
Cost allocation
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Any job that is partially completed (also called
work in process).
Open Job File (WIP)
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When the open job file is updated, the system
displays the job status query to the monitor.
Job Status Query
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With a print command, the job status report is
generated and printed.
Job status report
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Threat
Control
Production labor transaction file
To Payroll
Time Card or Labor Ticket
Data entry and verification
Time Card or Labor Ticket
Merge
Materials issuance transaction file
Data entry and verification
Materials requisition

• -Badge readers
• -Bar code scanners
• -Data entry program including
• Field checks
• Limit checks
• Validity checks

• Inaccurate Time Data
• Increase labor expenses
• Result in erroneous labor expense reports

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Threat
Control
Production labor transaction file
To Payroll
Time Card or Labor Ticket
Data entry and verification
Merge
Materials issuance transaction file
Data entry and verification
Materials requisition
Materials requisition

• -Badge readers
• -Bar code scanners

• Undocumented Lost Materials
• Inflated inventory

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Control
Production labor transaction file
To Payroll
Time Card or Labor Ticket
Data entry and verification
Data entry and verification
Merge
Materials issuance transaction file
Data entry and verification
Materials requisition

• Edit Checks