Question

Jenkins Company uses a job order cost system with overhead applied to jobs on the basis of direct labor hours. The direct labor rate is $20 per hour, and the predetermined overhead rate is $15 per direct labor hour. The company worked on three jobs during April. Jobs A and B were in process at the beginning of April. Job A was completed and delivered to the customer. Job B was completed during April, but not sold. Job C was started during April, but not completed. The job cost sheets revealed the following costs for April: Cost of Jobs in Process, 4/1/2018 Direct Materials Used Direct Labor Applied Manufacturing Overhead Job A $11,100 1,100 8,200 Job B $1,100 6,200 6,200 Job C $ - 6,300 2,100 ? Required: If no other jobs were started, completed, or sold, determine the balance in each of the following accounts at the end of April: a. Work in Process b. Finished Goods c. Cost of Goods Sold

Answer 1

Answers

• Working

Working		Job A	Job B	Job C
A	Direct Labor	$8,200	$6,200	$2,100
B	Direct labor rate	$20	$20	$20
C = A/B	No. of direct labor hours	410	310	105
D	Predetermined Overhead rate per DLHs	$15	$15	$15
E = C x D	Applied Manufacturing Overhead	$6,150	$4,650	$1,575

	Job A	Job B	Job C
Cost of Jobs in Process, 4/1/2016	$11,100	$1,100	—
Direct Materials Used	$1,100	$6,200	$6,300
Direct Labor	$8,200	$6,200	$2,100
Applied Manufacturing Overhead	$6,150	$4,650	$1,575
Balance at the end of April	$26,550	$18,150	$9,975

• Requirements

[a] Work in Process = Job C = $ 9975
[b] Finished Goods = Job B = $ 18150
[c] Cost of Goods Sold = Cost of Job A = $ 26550