Exam 5: Job-Order Costing

Langly Company provided the following data: Budgeted overhead \ 100,000 Budgeted direct labour hours 10,000 Actual overhead \ 99,000 Actual direct labour hours 11,000 A. What is applied overhead? B. What is the overhead variance? Is it overapplied or underapplied?

Nature's Best Milk produces dairy equipment. Most of its jobs have a number of units per job. The company has two different departments through which all jobs pass. Overhead is applied using a plantwide rate of $13 per direct labour hour. Direct labour wages average $8 an hour. Data for Job 3 for the year are as follows: -Refer to the Figure.What is the cost per unit?

Actual overhead is used to arrive at the cost of goods manufactured.

Process costing is used for manufacturing and service firms producing unique products or services.

Match each item with the correct statement below. -An overhead rate computed using estimated data

If actual overhead is less than applied overhead,the variance is called underapplied overhead.

Which of the following is NOT a manufacturing cost?

Rally Point Inc. designs and builds volleyball gymnasiums. Each gymnasium is custom-built to an individual customer's specifications. Rally Point uses job-order costing to track its costs. In January, Rally Point worked on three jobs. Data for these jobs are as follows: Overhead is applied to jobs at the rate of $25 per machine hour. By January 31, Job 200 is the only job unfinished. The balance of finished goods on January 1 is $63,290 (consisting of Job 100 only). Jobs 100 and 300 are sold during January. Rally Point sells its product at cost plus 40%. Job 100 Job 200 Job 300 Balance 1/1 \ 13,790 \ 0 \ 0 Direct Materials 16,200 8,500 30,500 Direct Labour Cost 23,300 7,600 45,000 Machine Hours 400 300 2,000 -Refer to Rally Point,Inc.What is the balance of finished goods at January 31?

Match each item with the correct statement below. -Overhead assigned to production using predetermined rates

Production costs consist only of direct labour and manufacturing overhead.

Match the following cost flows with the proper event in a job-costing firm: -Immaterial overhead variance closed to costs of goods

Bob's Powerwasher Company makes custom powerwashers for individual customers. On April 1, one job was in process, Job 900, which had a cost of $45,650. Jobs 901, 902, and 903 were started during the month of July. Data on costs added during the month are as follows: Overhead is applied to production at the rate of 85% of direct labour cost. Job 903 was completed on April 26, and the client was billed at cost plus 45%. All other jobs remained in process. Job 900 Job 901 Job 902 Job 903 Direct Materials \ 12,500 \ 6,740 \ 2,520 \ 7,870 Direct Labour \ 5,880 \ 10,280 \ 3,760 \ 11,360 -Refer to the Figure.What is the price of Job 903?

The journal entry for $17 of underapplied overhead is: Cost of Goods Sold 17 Overhead Control 17

Xbin Incorporated estimated overhead to be $440,000 and direct labour hours to be 100,000 for the year.Actual direct labour ended up being 120,000 hours.Actual overhead for the year amounted for $500,000. A. What is the predetermined overhead rate? B. What is the applied overhead for the year? C. What is the amount of under-or over-applied overhead at the end of the year?

Bob's Powerwasher Company makes custom powerwashers for individual customers. On April 1, one job was in process, Job 900, which had a cost of $45,650. Jobs 901, 902, and 903 were started during the month of July. Data on costs added during the month are as follows: Overhead is applied to production at the rate of 85% of direct labour cost. Job 903 was completed on April 26, and the client was billed at cost plus 45%. All other jobs remained in process. Job 900 Job 901 Job 902 Job 903 Direct Materials \ 12,500 \ 6,740 \ 2,520 \ 7,870 Direct Labour \ 5,880 \ 10,280 \ 3,760 \ 11,360 -Refer to Bob's Powerwasher Company.What is the balance in the work-in-process account on April 30?

In job-order costing,the journal entry for $1,700 of unpaid direct labour is: Work in Process 1,700 Wages Payable 1,700

Which account is credited when overhead is debited to overhead control?

Ending work in process for Hands On Carpentry was $64,000 for January.Direct labour and direct materials for the month had a combined total of $39,000.Direct labour was twice as much as direct materials.The overhead rate is 70% of direct labour.No jobs were finished during the month.What was the beginning work in process?

Michelle's has the following transactions for the month of October: 1.Purchased materials on account for $111,482. 2.Materials requisitioned for $82,383. 3.Direct labour of $51,000 was incurred (but not yet paid). 4.Actual overhead for the month was $33,000. It has not been paid yet (charge to various payables). 5.Overhead is applied to production at the rate of 70% of direct labour. 6.Jobs totalling $56,000 were transferred from work in process to finished goods. 7.Jobs costing $41,000 were sold.Balances at the beginning of the month were: Materials \ 17,890 Work in process 0 Finished goods 8,321 -Refer to the Figure.What is the ending balance of finished goods?

Xtra Company uses a job-order costing system to account for product costs. The following information pertains to the current year: Factory overhead rate is $18 per direct labour hour. Materials placed into production \ 160,000 Indirect labour 40,000 Direct labour (10,000 hours) 180,000 Depreciation of factory building 60,000 Other factory overhead 100,000 Increase in work-in-process inventory 50,000 -Refer to the Figure.What is the total amount debited to finished goods inventory in the current year?