Lecture Packet #1 Job Costing and Cost Allocation BLANK

ACCT 200:Foundations of Accounting II HCBP Packet #1 - Job Costing and Cost Allocations What is the business issue that accounting is helping to address?Gray areas?Consequences? For what types of business environment are job costing and process costing best suited?List a couple of examples, too. Job costing- Process costing- What is theultimate goalof both job costing and process costing?Why is this important from a business standpoint? Regardless of the production environment, accounting always starts with the activities that are taking place within the company's operations.Think about the following activities that take place at a manufacturing plant. What documents (electronic or hardcopy) signify the following activities have occurred?For an example, let's say you special ordered a Model S car from Tesla and want a particular color, interior fabric, and features (GPS, sunroof, autopilot, etc.). ActivityKey Documents The company receives an order from a customer. Production or engineering determines materials needed to produce the order. Production determines when the job can be made. Purchasing department determines if materials need to be purchased. If so, they place the order. Materials are received and placed in the RM inventory storeroom. Bill is received from supplier for the materials received. Production is ready to start the job, so they need DM from the storeroom. Assembly-line workers and machine operators work on the job. MOH is allocated to the job. The job is completed, so it is moved off the factory floor to FG inventory. The job (or units from it) are shipped to (or picked up by) the customer.