Question

At the end of April, Cavy Company had completed Job 766 and 765. According to the individual job cost sheets the information is as follows:

Job	Direct Materials	Direct Labor	Machine Hours
Job 765	$5,670	$3,500	27
Job 766	$8,900	$4,775	44

Job 765 produced 152 units, and Job 766 consisted of 250 units.

Assuming that the predetermined overhead rate is applied by using machine hours at a rate of $200 per hour, determine the (a) balance on the job cost sheets for each job, and (b) the cost per unit at the end of April.

Answer 1

a) Balance of Job cost sheet

	Job 765	Job 766
Direct material	5670	8900
Direct labor	3500	4775
Overhead	27*200 = 5400	44*200 = 8800
Total Job cost	14570	22475

b) Cost per unit

Job 765 = 14570/152 = 95.86

Job 766 = 22475/250 = 89.90