Sweeten Company had no jobs in progress at the beginning of March and no beginni

Question

Sweeten Company had no jobs in progress at the beginning of March and no beginning inventories. It started only two jobs during March-Job P and Job Q. Job P was completed and sold by the end of the March and Job Q was incomplete at the end of the March. The company uses a plantwide predetermined overhead rate based on direct labor-hours. The following additional information is available for the company as a whole and for Jobs P and Q (all data and questions relate to the month of March): Estimated total fixed manufacturing overhead Estimated variable manufacturing overhead per direct labor-hour Estimated total direct labor-hours to be worked Total actual manufacturing overhead costs incurred $ 11,000 $1.20 2,200 12,700 Direct materials Direct labor cost Actual direct labor-hours worked Job P Job Q $13,200 $ 8,200 $ 16,900 $ 7,800 300 60o

Explanation / Answer

1 What is the company's predetermined OH rate Predetermined OH Rate = Estimated Fixed OH / (Estimated Direct Labor hours + Variable OH Rate per hour) 11000/2200*1.2 6 per direct labor hr 3 Predetermined OH Rate = Estimated Fixed OH / (Estimated Direct Labor hours + Variable OH Rate per hour Direct Labor hourly wage rate = (Direct labor cost / Actual direct labor-hours worked)) Job p = 16900/1300 13 Job Q = 7800/600 13 Raaw material 22600 Accounts payable 22600 Work in progress 21400 raw material 21400

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