A manufacturing company employs job costing to account for its costs. There are three production departments, and separate departmental overhead application rates are employed because the operations of the departments are so different. All jobs generally pass through all three production departments. Data regarding the hourly direct labor rates, overhead application rates, and three jobs on which work was done during the month appear below. Job 101 and Job 102 were completed during the current month. (CIA Examination adapted)

\begin{array} { l c c } & \text { Direct Labor } & \\\text { Production Departments } & \text { Rate } & \text { Marufacturing overhead application rates } \\\text { Department 1 } & \$ 12.00 & 50 \% \text { of direct materials } \\\text { Department 2 } & 18.00& \mathbf { \$ 8 . 0 0 } \text { per machine hour } \\\text { Department 3 } & 15.00& 75 \% \text { of direct labor cost }\end{array}

\begin{array}{c}\begin{array}{lll}\\\text { Beginning Work-in-Process}\\\text { Direct materials:}\\\text { Department 1}\\\text { Department 2}\\\text { Department 3}\\\text { Direct labor hours:}\\\text { Department 1}\\\text { Department 2}\\\text { Department 3}\\\text { Machine hours:}\\\text { Department 1}\\\text { Department 2}\\\text { Department 3}\end{array}\begin{array}{ccccc}\text { Job } 101 & \text { Job } 102 & \text { Job } 103 \\\$ 25,500 & \$ 32,400 & \$ -0 \\\\ \$ 40,000 & \$ 26,000 & \$ 58,0 \\ 3,000 & \$ 5,000& \$ 4,0 \\-0- & \$ -0- & \$ -0- \\\\ 500 & 400 &300 \\ 200 & 250 & 350 \\ 1,500& 1,800&2,500 \\\\-0- & -0- & -0- \\ 1,200 & 1,500 &2,700 \\ 1,500 & 1,800& 2,500 \\\end{array}\end{array}

Required:
(a) Compute the completed costs of Job 101 and Job 102.
(b) Compute the value of the Work-in-Process Inventory at the end of the month.

Fogel Flight Company Uses a Job Costing System

Multiple Choice

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