Question

Madtack Company uses a job-order costing system and started the month
of March with only one job in process (Job #359). This job had $5,000
of total cost assigned to it at the beginning of March. Madtack applies
overhead to jobs at a rate of 175% of direct labor cost. During March,
Madtack assigned production costs as follows to the jobs worked on
during the month:

                             Job #359      Job #360      Job #361
direct materials ..........   $1,000         $5,000       $3,000
direct labor ..............    2,000          3,000        2,000

During March, Madtack completed and sold Job #360. Job #361 was also
completed but was not sold by the end of March. Job #359 was not
completed by the end of March. Madtack Company had total actual
overhead cost of $10,700 for the month of March. 

Calculate the cost of goods sold reported by Madtack for March after
the overhead variance has been closed.

Answer 1

Job Cost sheet
			Job 359	Job 360	Job 361	Total
Beginning Cost of WIP			5000			5000
Direct Material			1000	5000	3000	9000
Direct Labour			2000	3000	2000	7000
Oh applied (175% of DLC)			3500	5250	3500	12250
Total cost of Jobs			11500	13250	8500	33250
Status			WIP	Sold	FG
Under/Over applied Overheads
Actual Overheads incurred			10700
Less: Overheads applied			12250
Over-applied Overheads			1550
Cost of Good sold:
Cost of job 360 sold			13250
Less: Over-applied Overheads			1550
Adjusted Cost of Good ssold			11700