《成本与管理会计（英文）》课件-Problem of Overhead Application

CostandManagement

AccountingTheJobCosting:ProblemofOverhead

ApplicationTerminology:EnglishChineseImbalance不平衡Overhead

Variance间接费用差异Underapplied

Overhead少分配间接费用Overapplied

Overhead多分配间接费用Write-off冲销Proration按比例分配Consistency一致性Improper不正确的CostandManagement

AccountingReconcilingOverheadSpendingand

ApplicationWhenoverheadcostsareactuallyincurred,manufacturingoverheadcontrolareDebitedandCreditthe

accountsassociatedwiththeindirect

costs.Overhead

ControlAssociatedAccountsDebitCreditRECALLCostandManagement

AccountingReconcilingOverheadSpendingand

ApplicationEachtimeweassignoverheadtoajob,weDebittheJob’Work-in-ProcessInventoryaccountandCredittheOverheadControl

account.Overhead

ControlWork-in-Process

InventoryDebitCreditCostandManagement

AccountingActualcostswillalmostneverequalbudgetedcosts.Accordingly,animbalancesituationexistsbetweenthetwooverhead

accounts.Overhead

ControlThedifferencebetween

theestimated

overhead

costCostandManagement

AccountingappliedtoWork-in-ProcessandtheactualoverheadcostsfortheperiodiscalledtheOVERHEAD

VARIANCE.ReconcilingOverheadSpendingand

ApplicationUnderapplied

Overheadtheamountofoverhead

appliedtojobsduringtheperiod＜thetotalamountofoverheadactuallyincurredduringtheperiodtheamountofoverheadappliedtojobsduringtheperiod＞thetotalamountofoverheadactuallyincurredduringtheperiodOverapplied

OverheadReconcilingOverheadSpendingand

ApplicationCostandManagement

AccountingOverheadApplication

ExamplePearCo’sactualoverheadfortheyearwas$650,000withatotalof170,000directlaborhoursworkedonjobs.Howmuchtotaloverheadwasapplied

toPearCo’sjobsduringtheyear?UsePearCo’spredeterminedoverheadrateof$4.00perdirectlabor

hour.OverheadAppliedDuringthe

PeriodApplied Overhead = POHR ×

ActualDirectLabor

HoursAppliedOverhead=$4.00perDLH

×170,000DLH=

$680,000PearCohas

overappliedoverheadfortheyear

by$30,000.CostandManagement

AccountingWrite-offApproachProrationApproachAdjustedAllocation

RateApproachDispositionofUnder-orOverapplied

OverheadThedifferencewillbeeliminatedintheend-of-periodadjustingentryprocess,usingoneofthreepossible

methods.CostandManagement

AccountingDispositionofUnder-orOverapplied

Overhead01Thedifferenceissimplywrittenoff

tocostofgoods

soldWrite-offApproachUnadjustedBalancePearCo’s

CostofGoods

SoldPearCo’s

Mfg.Overhead

ControlOverheadappliedto

jobsActualoverheadcosts$650,000$680,000$30,000overapplied$30,000$30,000AdjustedBalanceCostandManagement

AccountingDispositionofUnder-orOverapplied

Overhead02Proration

ApproachThedifferenceisallocatedbetweencostofgoodssold,work-in-process,andfinishedgoodsbasedontheirrelative

sizes.AssumetheoverheadappliedinendingWorkinProcessInventory,endingFinishedGoodsInventory,andCostofGoodsSoldisshown

below:AmountOverheadappliedinWorkin

process$ 68,000OverheadappliedinFinished

Goods204,000OverheadappliedinFinished

Goods408,000Total$

680,000CostandManagement

AccountingDispositionofUnder-orOverapplied

OverheadOverheadapplied

ineach

accountAmountPercentof

TotalAllocation

of$30,000Workin

process$ 68,00010%$3,000Finished

Goods204,00030%9,000CostofGoods

Sold408,00060%18,000Total$ 680,000100%$30,000Wewouldcompletethefollowingallocationof$30,000overappliedoverhead:10%

×$30,000CostandManagement

AccountingDispositionofUnder-orOverapplied

OverheadGeneral

JournalCostandManagement

AccountingAllallocationsarerecalculatedwiththeactual,exact

allocationrate.DispositionofUnder-orOverapplied

Overhead03Adjusted

AllocationRate

ApproachThechoiceofmethodshouldbebasedonsuchissuesasmateriality,consistency,andindustry

practice.CostandManagement

AccountingDispositionofUnder-orOverapplied

OverheadWeshouldlookattheproblemfromtheperspectiveofdevelopment.Developmentisthemasterkeytosolvingallproblems.Onlybysolvingproblemsindevelopmentview,canwecalmlycopewithrisksand

challenges.CostandManagement

AccountingProceedingfromrealityisthestartingpointandfootholdforustothink,makedecisionsanddothings.Ifwewanttoberealistic,wemustproceedfromreality.Thepremiseistogodeepintorealityandunderstand

reality.JobCostandProject

ImproprietiesThefollowingconditionscanleadtoimproperjob

costing:CostandManagement

AccountingMisstatingthestage

ofcompletion.Chargingcoststothewrong

Job.Misrepresentingthecostof

jobs.Intentionalmisrepresentation

incontracts.Quick

Check1.AppliedFactoryOverheadisdebitedandFactoryOverheadiscredited

to:closetheestimatedoverheadaccounttoactual

overheadrecordtheactualfactoryoverheadforthe

periodchargeestimatedoverheadtoalljobsworkedonduringtheperiodtorecordoverappliedoverheadforthe

periodCostandManagement

AccountingQuick

CheckOverappliedfactoryoverheadwouldresult

if:theplantwereoperatedatlessthannormal

capacityfactoryoverheadcostsincurredwerelessthancostschargedtoproductionfactoryoverheadcostsincurredwereunreasonablylarge

inrelationtounits

producedfactory overhead costs incurred were greater than costschargedto

productionCostand