Cost Accounting Chapter 3

Front 1

storeroom supervisor

Back 1

is responsible for the protection of materials in the storeroom,and for identification of the materials.

Each type of material is assigned a number, indicating the type of materials and its location. Materials are stored in a systematic manner in bins, on racks, or on shelves.

Front 2

bin tag

Back 2

Attached to each bin or rack is a ________.

is an informal record showing the quantities of the materials received, issued, and on hand at all times.

Front 3

materials requisition

Back 3

No materials are issued from the storeroom without a ____________.

is prepared in duplicate by the department head or jobsupervisor.

It indicates the quantity, material number, description, and job number to which the materials are to be charged.

Upon receipt of this document, the storeroom supervisor issues the materials and makes the necessary notations on the requisition.

One copy is filed as a receipt, and the second copy is given to the storeroom clerk.

Front 4

storeroom clerk

Back 4

This person who computes and records the cost of the materials issued in the Issued section of the materials ledger card, computes the new quantity on hand, and records it in the Balance section.

Front 5

material ledger card

Back 5

is kept for each type of material on hand. Each card serves as a perpetual inventory record.

is a subsidiary ledger which isverified against the Materials account in the general ledger.

At the end of the accounting period, the balance on this document should equal the balance of the Materials account.

Front 6

materials requisition journal

Back 6

After recording the requisition in the related materials ledger card, the requisition is forwarded to the cost clerk, who journalizes the transactionin a special journal, the _______________ so that the effectof the issuance will be reflected in the general ledger cost accounts.

Special journals, such as ______________, are often used inJob order costing to improve the efficiency of the journalizing process.

These use of special journals avoids writing the many long and repetitious entries involved in issuing and using materials. Internal control also improves, since the recording process is delegated to several employees.

Front 7

Departmental Overhead Analysis Sheet

Back 7

All indirect manufacturing expenses such as indirect materials are posted from a requisition for such materials to the Indirect Materials section of the _______________________.

Front 8

True

Back 8

t/f

The internal control procedures for storing and issuing materials should reflect the following principles:

• Admittance to the storage area should be restricted.

• Materials ledger cards, covering all receipts and issues should be maintained.

• Each type of material should be clearly identified, stored andcarefully protected while in storage.

• Materials should be issued only upon proper writtenauthorization.

• The accounting system should permit a periodic check of thematerials ledger against the balance of the Materials account.

• Different persons should be involved in storage and issuance operations.

Front 9

returned materials report

Back 9

Materials returned to storeroom as a result of requisitioning too many materials, withdrawing wrong materials or other reasons must be accompanied by a __________.

Prepared in duplicate:

• filled out by the department that originally requisitioned the materials

• storeroom supervisor

Front 10

True

Back 10

t/f

The materials returned are entered in the bin tag in parenthesis under the Quantity Issued column. The number of units returned is added to the balance.

returned materials report is given to the storeroom clerk, who in turn follows the steps below:

• Enters the unit and total cost figures on the report. The unitcost is the same as that used when the materials were charged out.

• Makes an entry in parenthesis in the Issued section of thematerials ledger card. The new quantity and cost are then entered in the Balance column of the card.

• Sends the returned materials report to the cost clerk, whichcompletes the two important entries as follows:

> An entry in parenthesis in the Indirect Material column ofthe departmental overhead analysis sheet or in the Materials section of the appropriate job cost sheet.

> An entry covering the return in the returned materials journal. The totals of thematerials requisition journal and the returned materials journal are posted in summary form appropriate general ledger accounts at the end of the month.

Front 11

return shipping order

Back 11

authorizing the return is prepared by the purchasing agent in triplicate.

(1) with debit memorandum - purchasing agent

(2) shipping department

(3) with debit memorandum - accounting department