@ 2012, Cengage Learning Job Order Costing LO 2a – Recording Transactions Using Job- Order Costing: Materials

Job Order Cost System for Manufacturing LO 2

Materials The materials account in the general ledger is a controlling account. A separate account for each type of material is maintained in a subsidiary materials ledger. LO 2

The receiving report and the invoice are used to record the receipt of the merchandise and to control the payment for purchased items. Supplier Invoice $10,500 Receiving Report No. 196 Materials LO 2

Materials LO 2 Suppliers Invoice $10,500 Receiving Report No units of No. 8 Maple Wood A receiving report is prepared when materials that have been ordered are received and inspected.

Materials LO 2 If there are no discrepancies, a journal entry is made to record the purchase.

Materials LO 2 To Materials Requisitions (continued) a.

Materials LO 2 From Materials Ledger Account b.

Materials The storeroom releases materials to use in manufacturing when a materials requisition is received. A materials requisition for Job No. 71 is shown below. LO 2

Materials For direct materials, the quantities and amounts from the materials requisitions are posted to job cost sheets. Job cost sheets make up the work in process subsidiary ledger. Job No. 71 is shown below. LO 2

Materials A summary of the materials requisitions is used as a basis for the journal entry recording the materials used for the month. LO 2