Refer to Chapman Company. During March, Chapman\' employees worked on Job #649.

Question

Refer to Chapman Company. During March, Chapman' employees worked on Job #649. At the end of the month, $714 of overhead had been applied to this job. Total Work in Process at the end of the month was $6,800 and all other jobs had a total cost of $3,981. What amount of direct material is included in Job #649?

A) $677
B) $4,658
C) $1,391
D) $2,142

Refer to Chapman Company. What is the overhead application rate per direct labor hour?

A) $0.50
B) $4.25
C) $30.00
D) $2.00

Chapman Company uses a job-order costing system. At the beginning of March, the company had two jobs in process with the following costs:
Direct Material Direct Labor Overhead Job #456 $3,400 $510 $255 Job #461 1,100 289 ?
Chapman pays its workers $8.50 per hour and applies overhead on a direct labor hour basis.

Explanation / Answer

1. A) $677

2. Direct Labor Hours = $510/$8.50 = 60 hrs

Overhead Application Rate = $255 / 60 hrs = $4.25

Direct Materials--Job 649 Total Work in Process $6,800 Other Work in Process ($3,981) Costs remaining in WIP $2,819 Overhead $714 Direct Labor($714 * 2) $1,428 ($2,142) Direct Material $677

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