Homework Assignment chapter 2 Accounting

Homework Assignment 02A
Job Order Costing
1.Wisteria Company provided the following data:

Budgeted overhead
Budgeted direct labor hours
10,000 hrs.
Actual overhead
Actual direct labor hours
10,860 hrs.

Don't use plagiarized sources. Get Your Custom Essay on
Homework Assignment chapter 2 Accounting
Get an essay WRITTEN FOR YOU, Plagiarism free, and by an EXPERT!
Order Essay

What is applied overhead?
What is the overhead variance? Is it overapplied or underapplied?

2. Deluxe Design Company makes custom furniture. On December 1, there were two jobs in process, Job 683, with a cost of $14,200 and Job 684 with a cost of $23,500. Jobs 685, 686, and 687 were started during the month of December. Data on costs added during the month are as follows:

Job 683
Job 684
Job 685
Job 686
Job 687
Direct materials
Direct labor

Overhead is applied to production at the rate of 80% of direct labor cost. Job 685 was completed on December 17. Job 684 was completed on December 21 and the client was billed at cost plus 45%. All other jobs remained in process.

A.) The actual overhead for December was $41,100, calculate the variance.
B.) Calculate the sales price for Job #684.
C.) Calculate the adjusted cost of goods sold for the month of December.
D.) If selling and administrative expenses for the month totaled $5,600, what is the company’s operating income for December?

3. Reed Incorporated uses a job-order costing system and a predetermined overhead rate based on machine hours.

At the beginning of the year, the company estimated manufacturing overhead for the year would be $240,000 and machine hours would be 8,000.

The following information pertains to December of the current year:

Job 10
Job 11
Job 12
Work-in-process, Dec. 1
December production activity:
Materials requisitioned
Direct labor cost
Machine hours
400 hrs.
700 hrs.
900 hrs.
2,000 hrs.
Labor hours
120 hrs.
180 hrs.
200 hrs.
500 hrs.

Actual manufacturing overhead cost incurred in December was $61,000.

Compute the predetermined overhead application rate.
Determine the total cost associated with each job.
If Jobs 10 and 12 were completed, prepare the journal entry to move the cost.
If Job 10 was delivered to customers that paid $50,000 cash, prepare the journal entries.
What is the gross margin for Job 10?
What is the cost assigned to ending work in process?
Assuming no beginning finished goods, what is the cost assigned to ending finished goods?
How much was overhead over/underapplied?

4. If actual overhead for the year is $33,451 and applied overhead is $32,000, is the overhead variance overapplied or underapplied? Prepare the journal entry necessary to reconcile overhead. Assume the variance is immaterial.

5. Consider two costing systems, normal costing and actual costing.
Which costing system do most firms use to assign costs to units of product or service? What does this costing system include?
What is the other costing system? What does this costing system include?

6. During April, Cavy Company incurred factory overhead as follows:

Indirect materials
Factory supervision labor
Depreciation (factory)
Small tools
Equipment rental
Record the entry for factory overhead incurred during April.

7. At the end of April, Cavy Company had completed Jobs 766 and 765. The individual job cost sheets reveal the following information:
Direct Materials
Direct Labor
Machine Hours
Job No. 765
Job No. 766

Job 765 produced 152 units, and Job 766 consisted of 250 units.
Assuming that the predetermined overhead rate is applied by using machine hours at a rate of $200 per hour, determine the (a) balance on the job cost sheets for each job, and (b) the cost per unit at the end of April.

8. The Winston Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 50,000 hours. The total machine hours for the year were 54,300 hours. The actual factory overhead for the year was $1,375,000.
(a) Determine the total factory overhead amount applied.
(b) Calculate the over- or underapplied amount for the year.
(c) Prepare the journal entry to close Factory Overhead into Cost of Goods Sold.

9. Technics Inc., a manufacturing company, utilizes job order costing. Each division establishes its own estimates regarding overhead, which are as follows:

Division A
Division B
Total estimated overhead
Total estimated machine hours
Total estimated direct labor costs
If Division A allocates overhead on the basis of machine hours, and Division B allocates overhead as a percentage of direct labor costs, what would the predetermined overhead rate be for each division?

10. During August, the receipts and distributions of Material No. B4G9 are as follows:
1,100 units at $15

1,700 units at $17

900 units at $18


700 units for Job No. 116

1,900 units for Job No. 117

800 units for Job No. 118

(a) Determine the cost of each of the three issues under a perpetual system, using the first-in, first-out method.
(b) Present the journal entry to record the issuance of the materials for the month, assuming that the cost of issuances is determined by the first-in, first-out method.

11. On May 15, the stamping department accepted Job 051507A to make 1,000 funnels. Materials requisitioned were 1,100 sheets at $1.20 per sheet and 1,150 grommets at $0.15 per set. The cost driver used by stamping department is the drop-forge strokes indicated by a machine mounted counter. Overhead is applied at $2.25 for each drop-forge stroke. Additionally, $375.00 of overhead is applied to each job due to setup and tear down. Direct labor is applied at $22.50 per hour for the machine operator and $11.10 for the machine loader. The job required 6.5 hours of labor.
Upon completion, the job was transferred to Finished Goods Inventory.
Journalize all events as of May 15.

12.Discuss how job order cost information is used in decision making. What are some possible reasons that actual cost of materials would exceed expected costs for a job?



Homework Ocean
Calculate your paper price
Pages (550 words)
Approximate price: -

Why Work with Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

Professional and Experienced Academic Writers

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

24/7 Customer Support

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

Calculate the price of your order

Total price:

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.


Essay Writing Service

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.


Admission Essays & Business Writing Help

An admission essay is an essay or other written statement by a candidate, often a potential student enrolling in a college, university, or graduate school. You can be rest assurred that through our service we will write the best admission essay for you.


Editing Support

Our academic writers and editors make the necessary changes to your paper so that it is polished. We also format your document by correctly quoting the sources and creating reference lists in the formats APA, Harvard, MLA, Chicago / Turabian.


Revision Support

If you think your paper could be improved, you can request a review. In this case, your paper will be checked by the writer or assigned to an editor. You can use this option as many times as you see fit. This is free because we want you to be completely satisfied with the service offered.