Job order Costing Example

[@boomer02991]

Been following your work on here since I was in undergrad in 2014. Studying for the CPA exam now and I've been reviewing your videos. Just wanted to let you know that, even though your videos were amazing before, they're getting even better now. Keep it, sir. Thank you for what you do.

[@_Crazyslots]

Clear, professional, and right on point

[@MyFinancialFocus]

Love the real examples. Great explanation!

[@pizzacomo]

Are material costs usually included as part of overhead in job order costing? Thank you

[@Edspira]

Any materials that go into the final product are considered direct materials. Here's a video that goes over the 3 types of manufacturing costs: direct materials, direct labor, and manufacturing overhead. www.edspira.com/topic/3-types-manufacturing-costs/ Good question!

[@pizzacomo]

Thank you, your videos are very helpful!@@Edspira

[@kevincox5521]

You mentioned 10K of direct materials used for the job then you said "don't get confused if you bought 18K of direct materials" and I spent ten minutes being confused about what 18K you were referring to. Why are you throwing more scenarios into the mix that don't apply to the situation?

[@JorgeSanchez-tg3oh]

be grateful that you are receiving such great videos. Quit being so picky.

[@matthewsimpson4250]

He means that the $18,000 of raw materials purchased aren't the direct material cost used on the job-cost sheet because you are only using $10,000 of raw materials. $10,000 of raw materials would become WIP and then finished goods. The remaining $8,000 would remain in raw materials.