Question

National Survey Company uses a job order cost system. a. Indicate the source of the data for debiting Work in Process for each of the following: 1. Direct materials requisitioned 2. Direct labor used b. Indicate the source of the data for crediting Work in Process for jobs completed. for jobs completed. c. Present a list of the three controlling accounts used in the general ledger to record the inventories and, in each case, indicate the related subsidiary ledger. Controlling Account Subsidiary Ledger Materials Work in Process Finished Goods

Answer 1

In a job order cost system, direct materials are debited from materials requisition forms and direct labor from time records. For completed jobs, Work in Process is credited based on job cost sheets. The ledgers involved are Materials, Work in Process, and Finished Goods, each with a corresponding subsidiary ledger.

Step-by-step explanation:

For National Survey Company, which uses a job order cost system, the source of data for debiting Work in Process includes:

1. Direct materials requisitioned, typically derived from materials requisition forms.
2. Direct labor used, which comes from time tickets or labor time records.

The source of data for crediting Work in Process when jobs are completed is usually from job cost sheets that accumulate the costs associated with a specific job.

The three controlling accounts used in the general ledger to record inventories and their related subsidiary ledger are:

• Materials – Materials Ledger
• Work in Process – Work in Process Ledger
• Finished Goods – Finished Goods Ledger

Each controlling account is associated with a subsidiary ledger that provides detailed information for each individual component, like materials on hand, jobs in process, and the cost of finished goods.

Answer 2

In a job order cost system, the data for debiting Work in Process for 1) direct materials requisitioned is sourced from the materials requisition form, while the data for debiting Work in Process for 2) direct labor used is sourced from the employee time ticket.

Step-by-step explanation:

In a job order cost system, the source of the data for debiting Work in Process for direct materials requisitioned is the materials requisition form. This form shows the quantity and cost of materials used in a specific job.

The source of the data for debiting Work in Process for direct labor used is the employee time ticket, which records the number of hours worked by each employee on a specific job.

The source of the data for crediting Work in Process for jobs completed is the job cost sheet. This sheet summarizes the direct materials, direct labor, and applied overhead costs for a completed job.

The three controlling accounts used in the general ledger to record the inventories are Materials, Work in Process, and Finished Goods. The related subsidiary ledger for Materials is the Materials Ledger, which tracks the quantity and cost of materials.

The related subsidiary ledger for Work in Process is the Job Cost Ledger, which tracks the direct materials, direct labor, and applied overhead costs for each job. The related subsidiary ledger for Finished Goods is the Finished Goods Ledger, which tracks the quantity and cost of completed jobs ready for sale.