Job Costing
The following information is for Shiller Company for July 2010:
a. Applied factory overhead costs to jobs at the predetermined rate of $39.50 per labor-hour. Job 1467 incurred 6,175 labor-hours; Job 1469 used 4,275 labor-hours.
b. Shipped Job 1467 to customers during July. Job 1467 had a gross margin of 24 percent based on manufacturing cost.
c. Job 1469 was still in process at the end of July.
d. Closed the overapplied or underapplied overhead to the Cost of Goods Sold account at the end of July.
e. Factory utilities, factory depreciation, and factory insurance incurred is summarized by these factory vouchers, invoices, and cost memos:
Utilities | $ 14,250 |
Depreciation | 85,500 |
Insurance | 11,875 |
Total | $111,625 |
f. Purchased the following direct materials and indirect materials:
Material A | $ 25,000 |
Material B | 43,000 |
Indirect materials | 218,650 |
Total | $286,650 |
g. Direct materials and indirect materials used are as follows:
| Job 1467 | Job 1469 | Total |
Material A | $28,500 | $71,250 | $ 99,750 |
Material B | 9,500 | 33,250 | 42,750 |
Subtotal | $38,000 | $104,500 | $142,500 |
Indirect materials |
|
| 199,500 |
Total |
|
| $342,000 |
h. Factory labor incurred for the two jobs and indirect labor is as follows:
Job 1467 | $76,000 |
Job 1469 | 57,000 |
Indirect labor | 133,000 |
Total | $266,000 |
Required
1. Calculate the amount of overapplied or underapplied overhead and state whether the cost of goods sold account will be increased or decreased by the adjustment.
2. Calculate the total manufacturing cost for Job 1467 and Job 1469 for July 2010.
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