Financial and Managerial Accounting

Chapter 16 Job Order Costing

Learning Objectives

After studying this chapter, you should be able to:

1. Explain the characteristics and purposes of cost accounting.
2. Describe the flow of costs in a job order cost system.
3. Explain the nature and importance of a job cost sheet.
4. Indicate how the predetermined overhead rate is determined and used.
5. Prepare entries for jobs completed and sold.
6. Distinguish between under- and overapplied manufacturing overhead.

Feature Story

She Succeeds Where Others Have Failed

The financial press is fond of highlighting the fact that, sporting stilettos and leather skirts, Lynn Tilton does not dress like your typical manufacturing executive. Much more important, however, is the fact that her business success is also far from typical. In fact, as the full or partial owner of 74 companies with revenues of more than $8 billion, Tilton is one of the wealthiest female entrepreneurs in the United States. Her company, Patriarch Partners, is sometimes referred to as the largest woman-owned business in America.

Her path to success is an inspiring tale of determination. Tilton started on Wall Street as a single mother, working 15-hour days as she put herself through ...