PART 3 To keep Overhead is applied at the rate of 50% of the direct labor cost J

Question

PART 3 To keep Overhead is applied at the rate of 50% of the direct labor cost Job Order Costing Section January 1 Job Order Costing records of the actual cost of a special order job, a Job Order Cost System has been developed , 2017, Division S began Job 2407 for the Client, THE BIG CHILDREN STORE. The job called for 4,000 customized lamps. The following set of transactions occurred from January 5 until the job was completed 5 Purchased 4,150 figurines@ $9.35 per figurine. Purchased 4,250 sets of electrical components@$1.35 per set. January 6 January 7 January 8 January 9 4,225 sets of electrical components were requistioned. January 17 Payroll of 570 Direct Labor Hours$9.70 per hour January 28 3,990 lamp shades were requisitioned. January 30 Payroll of 620 Direct Labor Hours @$9.95 per hour. January 30 3,990 lamps were completed and shipped. All materials requisitioned were used or s Purchased 4,000 lamp shades$6.40 per set 4,100 figurines were requisitioned crapped, and are a cost of normal processing Month End Overhead Information Actual Variable Manufacturing Overhead Actual Fixed Manufacturing Overhead s1,213 80 $39,623 45 Round to six places $XX.XXXXXX Cost of Direct Material incurred in manufacturing Job 2407 Round to six places SXX.XXxxxx Cost of Direct Labor incurred in manufacturing Job 2407 Round to six places SXX.XXXxxX Cost of manufacturing overhead applied to Job 2407 Round to six places SXX.Xxxxxx LCostor manufacturing one lamp

Explanation / Answer

Req 1: Cost of material for Job no. 2407 Material requisitioned to Job: 4100 figurines @9.35 per figurine 38335 4225 sets of electrical components@1.35 5703.75 3990 lamp shades were requisitioned@6.40 25536 Total Material cost of Job 69574.75 Req2: Cost of Direct labour incurred in Job 2407 570 Direct labour hours paid @9.70 5529 620 Direct labour hours paid @9.95 6169 Total labour cost for Job 11698 Req 3: Cost of manufacturing overhead applied to Job 2407 Overhead rate is 50% of labour cost Direct labour cost of Job 2407   $ 11698 Overhead applied to Job (11698*50%) = $ 5,849 Req4: Cost of manufacturing one lamp Total cost of producing 3990 lamps: Material cost (as computed above) 69574.75 Labour cost(as computed above) 11698 Overhead applied(as computed above) 5849 TOTAL COST 87121.75 Units Produced 3990 Cost per lamp(87121.75/3990) 21.835025

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