Geolander manufactures tires for all terrain vehicles Geolander uses job costing
Geolander manufactures tires for all-terrain vehicles. Geolander uses job costing and has a perpetual inventory system. On September 22, Geolander received an order for 100 TX tires from ATV Corporation at a price of $55 each. The job, assigned number 298, was promised for October 10. After purchasing the materials, Geolander began production on September 30 and incurred the following direct labour and direct materials costs in completing the order:
Geolander allocates manufacturing overhead to jobs on the basis of the relation between expected overhead costs ($540,000) and expected direct labour hours (20,000). Job 298 was completed on October 3 and shipped to ATV on October 5.
1. Prepare a job cost record for Job 298 similar to Exhibit 3-7.
2. Calculate the total profit and the per-unit profit for Job 298.
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