Snappy Company has a job-order costing system and uses apredetermined overhead rate based on direct labor-hours to applymanufacturing overhead to jobs. Manufacturing overhead cost anddirect labor hours were estimated at $45,000 and 30,000 hours,respectively, for the year. In July, Job #334 was completed at acost of $2,150 in direct materials and $1,500 in direct labor. Thelabor rate is $5.00 per hour. By the end of the year, Snappy hadworked a total of 35,000 direct labor-hours and had incurred$55,250 actual manufacturing overhead cost.
If Job #334 contained 100 units, the unit product cost on thecompleted job cost sheet would be:
$41.00
$36.00
$37.67
$38.00
Snappy Company has a job-order costing system and uses apredetermined overhead rate based on direct labor-hours to applymanufacturing overhead to jobs. Manufacturing overhead cost anddirect labor hours were estimated at $45,000 and 30,000 hours,respectively, for the year. In July, Job #334 was completed at acost of $2,150 in direct materials and $1,500 in direct labor. Thelabor rate is $5.00 per hour. By the end of the year, Snappy hadworked a total of 35,000 direct labor-hours and had incurred$55,250 actual manufacturing overhead cost. |
If Job #334 contained 100 units, the unit product cost on thecompleted job cost sheet would be:
$41.00
$36.00
$37.67
$38.00
Related questions
1.)
Snappy Company has a job-order costing system and uses apredetermined overhead rate based on direct labor-hours to applymanufacturing overhead to jobs. Manufacturing overhead cost anddirect labor hours were estimated at $69,000 and 30,000 hours,respectively, for the year. In July, Job #334 was completed at acost of $2,010 in direct materials and $1,800 in direct labor. Thelabor rate is $6 per hour. By the end of the year, Snappy hadworked a total of 35,500 direct labor-hours and had incurred$79,350 actual manufacturing overhead cost.
If Job #334 contained 100 units, the unit product cost on thecompleted job cost sheet would be: (Round intermediatecalculations to 2 decimal places.)
2.)Buckeye Company has provided the followingdata for maintenance cost:
| PriorYear | CurrentYear | |
| Machine hours | 15,700 | 17,900 |
| Maintenance cost | $32,500 | $35,140 |
The best estimate of the cost formula for maintenance would be:(Do not round intermediate calculations. Round yourVariable cost per unit to 2 decimal places.)
3.)
Bakker Corporation applies manufacturing overhead on the basisof direct labor-hours. At the beginning of the most recent year,the company based its predetermined overhead rate on totalestimated overhead of $110,250 and 3,500 estimated directlabor-hours. Actual manufacturing overhead for the year amounted to$112,200 and actual direct labor-hours were 3,250.
The applied manufacturing overhead for the year was: (Roundyour intermediate calculations to 2 decimal places.)
Pedriani Company uses a job order cost system and applies overhead to production on the basis of direct labor hours. On January 1, 2017, Job No. 25 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $10,000; direct labor $6,000; and manufacturing overhead $9,000. Job No. 23 had been completed at a cost of $42,000 and was part of finished goods inventory. There was a $5,000 balance in the Raw Materials Inventory account.
During the month of January, the company began production on Jobs 26 and 27, and completed Jobs 25 and 26. Jobs 23 and 25 were sold on account during the month for $63,000 and $74,000, respectively. The following additional events occurred during the month.
1. Purchased additional raw materials of $45,000 on account.
2. Incurred factory labor costs of $33,500. Of this amount, $7,500 related to employer
payroll taxes.
3. Incurred manufacturing overhead costs as follows: indirect materials $10,000;
indirect labor $9,500; depreciation expense on equipment $12,000; and various
other manufacturing overhead costs on account $11,000.
4. Assigned direct materials and direct labor to jobs as follows.
| Job No. | Direct Materials | Direct Labor |
| 25 | $ 5,000 | $ 3,000 |
| 26 | 17,000 | 12,000 |
| 27 | 13,000 | 9,000 |
5. The company uses direct labor hours as the activity base to assign overhead. Direct labor hours incurred on each job were as follows: Job No. 25, 200; Job No. 26, 800; and Job No. 27, 600.
Instructions
(a) Calculate the predetermined overhead rate for the year 2017, assuming Pedriani Company estimates total manufacturing overhead costs of $440,000, direct labor costs of $300,000, and direct labor hours of 20,000 for the year.
(b) Open job cost sheets for Jobs 25, 26, and 27. Enter the January 1 balances on the job cost sheet for Job No. 25.
(c) Prepare the journal entries to record the purchase of raw materials, the factory labor costs incurred, and the manufacturing overhead costs incurred during the month of January.
(d) Prepare the journal entries to record the assignment of direct materials, direct labor, and manufacturing overhead costs to production. In assigning manufacturing overhead costs, use the overhead rate calculated in (a). Post all costs to the job cost sheets as necessary.
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(e) Total the job cost sheets for any job(s) completed during the month. Prepare the journal entry (or entries) to record the completion of any job(s) during the month.
(f) Prepare the journal entry (or entries) to record the sale of any job(s) during the month.
(g) What is the balance in the Work in Process Inventory account at the end of the month? What does this balance consist of?
(h) What is the amount of over- or underapplied overhead?
