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Zoey owns a bakery they use about $500 worth of raw materials per day and 8 hours of direct labor from their 2 employees and about 4 hours of direct labor for themself. When moving the manufacturing costs into production, what would be the best action for determining the accuracy of the associated journal entries for each individual job?

User ZorbaTHut
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Final answer:

To determine the accuracy of the journal entries for each individual job, Zoey should follow the process of cost accounting and reconcile the actual costs with the recorded amounts in the journal entries. Regular review of inventory records is also important to identify and correct any discrepancies.

Step-by-step explanation:

In order to determine the accuracy of the journal entries for each individual job, Zoey should follow a specific process called cost accounting. Cost accounting is a method used to track and analyze the costs associated with manufacturing and production. It involves keeping detailed records of all direct and indirect costs that are incurred during the manufacturing process.

One way to ensure the accuracy of the journal entries is to reconcile the total cost of raw materials and labor used with the recorded amounts in the journal entries. Zoey can compare the actual cost of raw materials purchased and the hours of direct labor utilized with the cost and labor allocated to each job in the journal entries. Any discrepancies should be investigated and corrected.

Another important step is to regularly review the inventory records. Zoey should compare the actual inventory levels with the recorded inventory in the journal entries. This can be done through physical inventory counts and reconciliation with the recorded amounts. Any discrepancies should be investigated and adjusted in the journal entries.

User Reirab
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