Question

Cost of a Manufactured Product-Job Costing System Ross Poldark is a contractor specializing in custom-built Jacuzzis. As of May 1, 2018, Poldark has incurred the following costs for each of the jobs listed below. Poldark uses the Job Order Cost system. ENYS CARNE TRURO DM $ 2,100 $ 1,850 $ 800 DI 1,900 1,600 660 FOH 1,520 1,280 528 TOTAL $ 5,520 $ 4,730 $ 1,988 During May, Poldark incurs the following costs below. Poldark begins one job during the month of May (George) and completes the other three during the course of the month (Enys, Carne, and Truro). Factory Overhead is charged to jobs on the basis of $.80 per dollar of direct labor hours. ENYS CARNE TRURO GEORGE DM $ 400 $ 590 $ 1,540 $ 1,100 DL 360 920 1,900 800 FOH TOTAL Determine the total cost of each of the completed jobs in the space below: ENYS CARNE TRURO DM DL FOH TOTAL

Answer 1

Answer with working is given below

Opening WIP DM ENYS $2,100 $1,900 $1,520 $5,520 CARNE $1,850 $1,600 $1,280 $4,730 TRURO $800 $660 $528 $1,988 $400 Cost incurred during the month ENYS DM $360 $288 $1,048 CARNE TRURO GEORGE $590 $1,540 $1,100 $920 $1,900 $800 $736 $1,520 $640 $2,246 $4,960 $2,540 Total Cost of Completed Jobs ENYS $2,500 $2,260 $1,808 $6,568 CARNE $2,440 $2,520 $2,016 $6,976 TRURO $2,340 $2,560 $2,048 $6,948 Cost of completed jobs Opening WIP + Cost incurred during the period Total Amount left in WIP Account GEORGE DM $1,100 $800 $640 $2,540 Gross profit for completed jobs ENYS Sales $11,000 Cost of Completed Jobs $6,568 Gross profit $4,432 CARNE $11,000 $6,976 $4,024 TRURO $11,000 $6,948 $4,052 Actual Overheads IM $380 $1,541 $1,543 $3,464 Other Total Overheads absorbed Under-absorbed Overheads $3,184 $280 FOH is under absorbed Gross profit will be overstated due to this under absorbed Overheads Even Net Income will be overstated If Under-absorbed Overheads is charged to COGS during the month impact of under-absorbed Overheads will be nullified