Quiz 4 Cost ACCT
Badour Inc. is a job-order manufacturer. The company uses a predetermined overhead rate based on direct labor hours to apply overhead to individual jobs. For the current year, estimated direct labor hours were 129,000 and estimated factory overhead was $980,400. The following information was for September. Job X was completed during September, while Job Y was started but not finished. September 1, inventories: Materials $ 10,600 Work-in-process (All Job X) 38,900 Finished goods 81,900 Materials purchases $ 140,000 Direct materials requisitioned: Job X $ 56,000 Job Y 41,500 Direct labor hours: Job X 6,500 Job Y 6,000 Labor costs incurred: Direct labor ($7.50 per hour) $93,750 Indirect labor 17,700 Factory supervisory salaries 8,700 Rental costs: Factory $ 9,900 Administrative offices 3,700 Total equipment depreciation costs: Factory $ 10,600 Administrative offices 3,400 Indirect materials used $ 15,900 The total cost of Job X is:
$193,050. Overhead application rate = $980,400/129,000 = $7.60 per DL-hour Materials + Labor + Applied OH + Beginning WIP = Total cost of Job X $56,000 + (6,500 × $7.50) + (6,500 × $7.60) + $38,900 = $193,050
Badour Inc. is a job-order manufacturer. The company uses a predetermined overhead rate based on direct labor hours to apply overhead to individual jobs. For the current year, estimated direct labor hours were 117,000 and estimated factory overhead was $748,800. The following information was for September. Job X was completed during September, while Job Y was started but not finished. September 1, inventories: Materials $ 9,300 Work-in-process (All Job X) 37,700 Finished goods 80,700 Materials purchases $ 128,000 Direct materials requisitioned: Job X $ 54,800 Job Y 40,300 Direct labor hours: Job X 5,300 Job Y 4,800 Labor costs incurred: Direct labor ($6.30 per hour) $63,630 Indirect labor 16,500 Factory supervisory salaries 7,500 Rental costs: Factory $ 8,700 Administrative offices 2,500 Total equipment depreciation costs: Factory $ 9,300 Administrative offices 2,200 Indirect materials used $ 14,700 The underapplied or overapplied overhead for September is:
$7,940 overapplied. $64,640 − $56,700 = $7,940 overapplied Actual factory overhead = $16,500 + 7,500 + 8,700 + 9,300 + 14,700 = $56,700 Where $6.40 = $748,800/117,000 = Predetermined Overhead Rate
At the end of a fiscal year, overapplied factory overhead should be:
Credited to Cost of Goods sold.
A normal costing system uses actual costs for direct materials and direct labor, and:
Estimated costs for factory overhead.
Which one of the following documents records and summarizes the costs of direct materials, direct labor, and factory overhead for a particular job?
Job cost sheet.
Which of the following industries is more suitable for using a job costing system?
Medical clinics
Badour Inc. is a job-order manufacturer. The company uses a predetermined overhead rate based on direct labor hours to apply overhead to individual jobs. For the current year, estimated direct labor hours were 117,000 and estimated factory overhead was $748,800. The following information was for September. Job X was completed during September, while Job Y was started but not finished. September 1, inventories: Materials $ 9,300 Work-in-process (All Job X) 37,700 Finished goods 80,700 Materials purchases $ 128,000 Direct materials requisitioned: Job X $ 54,800 Job Y 40,300 Direct labor hours: Job X 5,300 Job Y 4,800 Labor costs incurred: Direct labor ($6.30 per hour) $63,630 Indirect labor 16,500 Factory supervisory salaries 7,500 Rental costs: Factory $ 8,700 Administrative offices 2,500 Total equipment depreciation costs: Factory $ 9,300 Administrative offices 2,200 Indirect materials used $ 14,700 The total factory overhead applied during September is:
$64,640. $64,640 = (5,300 + 4,800) × ($6.40) Where $6.40 = $748,800/117,000 = Predetermined Overhead Rate