Part 1: Information to use in completing is below and the requirements follow where you will answer the questions.
Glass Company makes glass orders based on the customer specifications, so the company uses job costing to track costs.
The company uses direct labor hours as the cost driver for manufacturing overhead application.
The company estimated the following manufacturing overhead costs for the year: $600,000
The company estimated the following usage of direct-labor hours for the year: 200,000
Beginning Work-in-process, March 1 (Job 57) $108,000
Beginning Finished Goods, March 1 (Job 55) $125,000
Labor Information for March:
Direct-labor hours:
Job 57 7,000
Job 58 6,000
Job 59 4,000
Labor costs:
Direct-labor wages $408,000
Indirect-labor wages $30,000
Supervisory salaries $12,000
Material Information for March:
Raw Materials, Inventory, March 1 $21,000
Purchase or raw material $210,000
Direct materials requisitioned:
Job 57 $90,000
Job 58 $75,000
Job 59 $51,000
Other costs incurred in March:
Factory Utilities $12,000
Sales offices Utilities $3,200
Administrative offices Utilities $2,000
Factory equipment repair and maintenance costs $11,200
Depreciation on factory equipment $5,000
Manufacturing supplies purchased and used $24,000
During March the following jobs were completed and sold for the following sales price:
Job 57 $400,000
Job 58 $250,000
Required: You need to use cell references to provide answers and calculations.
Complete the job cost sheets provided below for the month of March:
|
Labor Rate |
$24.00 |
||||
|
Job 57 |
Job 58 |
Job 59 |
Total |
||
|
Beginning Balance |
$108,000 |
||||
|
Current costs: |
|||||
|
Direct materials |
$90,000 |
$75,000 |
$ 51,000.00 |
$ 216,000.00 |
|
|
Direct Labor |
$168,000.00 |
$ 144,000.00 |
$ 96,000.00 |
$ 408,000.00 |
|
|
Applied overhead |
$21,000 |
$18,000 |
$ 12,000.00 |
$ 51,000.00 |
|
|
Total |
$387,000 |
$237,000 |
$159,000 |
||
QUESTION Determine the ending Work-In-Process Inventory at the end of March and provide the number of the Job(s) still in Work-in-Process at the end of March and the determine total cost of ending work in process for March.
| Pre-determined oH rate: Estimated Manufacturing OH/ Direct labour hours | ||||||||||
| $ 600,000 /200,000 DLH = $ 3 per DLH | ||||||||||
| Labouor rate per hour: Total Direct labour cost/ Total DLH | ||||||||||
| $ 408,000 /(7000+6000+4000) = $ 24 per hour | ||||||||||
| JOB COST SHEET | ||||||||||
| Job 57 | Job 58 | Job 59 | Total | |||||||
| Beginning WIP | 108000 | 108000 | ||||||||
| Add: Current cost of manufacturing | ||||||||||
| Direct material cost | 90000 | 75000 | 51000 | 216000 | ||||||
| Direct labour cost @ 24 per hour | 168000 | 144000 | 96000 | 408000 | ||||||
| OH applied @ 3 per hour | 21000 | 18000 | 12000 | 51000 | ||||||
| Total | 387000 | 237,000 | 159000 | 783000 | ||||||
| Less: Transferred to Finished Goods | 387000 | 237000 | 624000 | |||||||
| Balance in WORK in Process ending | 0 | 0 | 159000 | 159000 | ||||||
| Hence, | ||||||||||
| It is imperative, only Job no. 59 is in proces at the end of year and total WIP balance in Job no. 59 is $ 159,000 | ||||||||||
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