Module 1: Introduction to Manufacturing Cost Systems

This opening module lays the foundation by introducing the concepts of process costing and job order costing within manufacturing environments. You will explore the importance of manufacturing cost systems, key cost classifications (direct materials, direct labor, and manufacturing overhead), and their role in financial reporting and managerial decisions. Emphasis is placed on understanding the flow of costs in manufacturing companies and the reasons behind choosing specific costing methods.

Key topics include:

Overview of manufacturing cost systems
Cost classifications and their impact
Differences between job order and process costing
Introduction to process costing training fundamentals

Module 2: Process Costing System – Concepts and Applications

Dive deep into the process costing system, a method widely used in industries where production is continuous and units are indistinguishable (e.g., chemicals, textiles, food production). This module covers the step-by-step flow of costs—raw materials, work-in-process, factory overhead, finished goods—and cost allocation.

You will learn:

Detailed flow of costs in a process costing environment
Calculating equivalent units of production
Cost allocation using FIFO and Weighted Average methods
Recording journal entries related to direct materials, labor, and overhead
Practical examples of cost accumulation and transfer between departments

Module 3: Job Order Costing System – Fundamentals and Execution

Explore the job order costing system, designed for custom or batch production where each job or order is distinct (e.g., construction, custom manufacturing). This module explains how to track costs by job, allocate overhead based on predetermined rates, and prepare job cost sheets.

Key learning points:

Overview of job order costing principles
Cost tracking for individual jobs or batches
Overhead allocation and predetermined overhead rates
Journal entries for job order costing transactions
Practical case studies to reinforce concepts

Module 4: Overhead Costing and Allocation Techniques

Manufacturing overhead is a complex but crucial part of cost accounting. This module provides a thorough understanding of overhead costs—how to estimate, apply, and allocate overhead using various methods. You will also learn to distinguish between actual overhead and applied overhead and adjust for variances.

Topics include:

Types of manufacturing overhead
Calculating predetermined overhead rates
Applying overhead to production departments
Overhead variance analysis and adjustments
Integration of overhead costs in both costing systems

Module 5: Costing Reports and Managerial Decision Making

Accurate cost reporting is essential for effective managerial decisions. This module focuses on interpreting costing reports derived from both process and job order costing systems. You will gain skills to analyze cost statements, identify cost control issues, and support budgeting and pricing decisions.

Highlights include:

Preparing and interpreting process cost reports
Analyzing job cost sheets for profitability
Cost control and performance evaluation techniques
Using cost information for strategic decisions
Real-world examples of managerial cost use

Module 6: Practical Application and Case Studies

This module is designed to consolidate your learning through practical application. Using downloadable Excel templates, journal entry exercises, and real manufacturing scenarios, you will practice recording transactions, calculating costs, and preparing reports.

Features:

Hands-on Excel exercises for cost calculation
Journal entry practice for both costing systems
Case studies from various manufacturing industries
Quizzes and discussion questions for active learning

Resources for further reference and self-study

Process Costing and Job Order Costing Masterclass Training Course in London

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