2) (5 points) Use the T-accounts below. beginning Post the journal entries writt

Question

2) (5 points) Use the T-accounts below. beginning Post the journal entries written above.n verify that they agree with the ending balances Include the beginning balances in each of the accounts below in 2) above. Determine the ending balances for each account and Raw Material Finished Goods Work-in-Process 33a B1K 66ok MOH Clearing COGS MoH 356 33a- ??? G84 ?28, BY 92 and ZF14. While these jobs are in process their costs are accumulated in WIP inventory represented in Ig above. Use the information below to complete the Jobs Report provided 3) (12 points total) Traditional Job Costing: Superior Company's business includes three large jobs, account. Once a job is completed, all the costs accumulated to date are transferred to COGS. This is the JE below. Remember to show your work for partial credit. (2 points) Direct Material: Job JV28 used 40% of the company's Direct Material (amount from JE lb) Job BY92 used 12% and Job ZF14 use 22% the company's Direct Material. Use these percentages and calculate the Direct Material for each job. Include these amounts in the table a) has other jobs they sold as well as jobs that are still in inventory. Calculate the Direct Material Report below below. The combined total for the three jobs WILL NOT agree to the total costs because Superior costs for each job as the percent given for each job times your total Direct Material from your JE in 1b. Include these amounts (2 points) Direct Labor: Job JV28 used 35% of the company's direct labor (amount from JE lc). Job BY92 usd 18% and Job ZF14 used 20%. Calculate the Direct Labor dollars for each job and include them on the Jobs b) 4uco 2 points) Each customer is charged a markup to Direct Material. Therefore, the percentage of direct material for each job given in 3a above can be used to allocate the total revenue (JE 11) to each job. Use the percentage of Direct Material to allocate the company's revenue to each job and include them in the Jobs Report below. (40%, 12% and 22% respectively) These amounts represent the amounts billed/charged to each customer during the period and cannot change 107000 2131G 2 41340

Explanation / Answer

a.

Budgeted Overhead applied: $332,000

Direct Labor cost = $70,000

Overhead Rate = $332,000 / $70,000 = 474.29%

b.

Budgeted Overhead applied = $332,000

Direct Labor hours = 5,500

Overhead rate per hour = $332,000 / 5,500 = $60.3636 per hour

c.

If actual labor hours worked are 6,000,

Overhead applied would be 6,000 x $60.36 = $362,181.82

Overhead would be over applied. The over applied overhead is to be adjusted by the Cost of Goods Sold if the overhead is immaterial.

d.

overhead applied on the basis of direct labor cost is based on the Labor cost and not labor hours. When the cost of direct labor changes, the overhead applied would also undertake change. It is irrelevant with the number of hours of labor being changed or not. This method is so rare in use.

Overhead applied on the basis of direct labor hours change with the change in direct labor hours. Due to variation in no. of hours, the overhead applied would undergo change and this method is so wide in use.

e. This situation doesn't change actual overhead occurred. Actual overhead incurred is the amount actually spent by the company for the overhead. We use these techniques just to apportion and allocate the budgeted overhead. These have nothing to do with the actual overhead.

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