Question: 1. List the three types of costs that are typically recorded on a job cost sheet. How can managers use job cost sheets?
2. During the current month, a company that uses a job order cost accounting system purchases $70,000 in raw materials for cash. It then uses $22,000 of raw materials indirectly as factory supplies and uses $42,000 of raw materials as direct materials. Prepare entries to record these three transactions.
3. Why does job order cost accounting require a predetermined overhead rate?