1. Blaine Corp. makes floats for Mardi Gras in New Orleans. The company\'s fisca

Question

1. Blaine Corp. makes floats for Mardi Gras in New Orleans. The company's fiscal year ends on March 31. On January 1, 2010, the company's WIP Inventory account appeared as follows:
Work In Progress Inventory
Beginning Balance 916,650 / Cost of completed jobs?????
direct material 589,670
direct labor 159,600
applied over-head 127,680

The direct labor cost contained in the beginning balance of WIP Inventory was for a total of 15,200 direct labor hours (DLHs). During January, 7,600 DLHs were recorded. Only one job was still in process on January 31. That job had $73,250 in direct material and 2,850 DLHs assigned to it.

a. If overhead is applied on the basis of DLHs, what predetermined OH rate was in effect during the company's 2009–2010 fiscal year? Round your answer to the nearest cent.
$ per DLH

b. What was the average direct labor rate per hour?
$ per DLH

c. What amount of direct material cost was in the beginning balance of WIP Inventory?
$ DM in beginning WIP

d. What was the balance in WIP Inventory at the end of January?
$

e. What was the total cost of jobs manufactured in January?
$

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Insides, an interior decorating firm, uses a job order costing system and applies overhead to jobs using a predetermined rate of $17 per direct labor hour. On June 1, 2010, Job #918 was the only job in process. Its costs included direct material of $8,250 and direct labor of $500 (25 hours at $20 per hour). During June, the company began work on Jobs #919, #920, and #921. Direct material used for June totaled $21,650. June's direct labor cost totaled $6,300. Job #920 had not been completed at the end of June, and its direct material and direct labor charges were $2,850 and $800, respectively. All other jobs were completed in June.

a. What was the total cost of Job #920 as of the end of June 2010?
$

b. What was the cost of goods manufactured for June 2010?
$

c. If actual overhead for June was $5,054, was the overhead underapplied or overapplied for the month? By how much?

SelectOverappliedUnderappliedItem 3 OH $

Explanation / Answer

a. If overhead is applied on the basis of DLHs, what predetermined OH rate was in effect during the company's 2009–2010 fiscal year? Round your answer to the nearest cent.
   $16.80 per DLH i.e. $127,680 / 7,600 DLH

b. What was the average direct labor rate per hour?
    $21 per DLH i.e. $159,600 / 7,600 DLH

c. What amount of direct material cost was in the beginning balance of WIP Inventory?
    $597,450 DM in beginning WIP i.e. (916,650 - (15,200 x $21)

d. What was the balance in WIP Inventory at the end of January?
    $59,850 i.e. 2,850 DLH x $21

e. What was the total cost of jobs manufactured in January?
    $1,500,900
   Beginning WIP Inventory          $916,650
   Add : Direct materials                 $589,670
   Add : Direct labor                        $159,600
   Add : Overheads                         $127,680
   Less : Ending WIP Inventory    
             ($73,250 + $59,850)       ($133,100)   
    Cost of jobs manufactured   $,1660,500
                                                ===========

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