Lorenzo Company uses a job order costing system that charges overhead to jobs on the basis of
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Question:
Lorenzo Company uses a job order costing system that charges overhead to jobs on the basis of direct materials cost. At year-end, the Work in Process Inventory account shows the following.
Date | Explanation | Debit | Credit | Balance | |||||
2017 | |||||||||
Dec. | 31 | Direct materials cost | 1,800,000 | 1,800,000 | |||||
31 | Direct labor cost | 250,000 | 2,050,000 | ||||||
31 | Overhead applied | 612,000 | 2,662,000 | ||||||
31 | To finished goods | 2,572,000 | 90,000 | ||||||
Required 1
Determine the predetermined overhead rate used (based on direct material cost).
Required 2 Only one job remained in work in process inventory at December 31, 2017. Its direct materials cost is $30,000. How much direct labor cost and overhead cost are assigned to this job?
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Related Book For
Management Accounting Information for Decision-Making and Strategy Execution
ISBN: 978-0137024971
6th Edition
Authors: Anthony A. Atkinson, Robert S. Kaplan, Ella Mae Matsumura, S. Mark Young
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