$6\mathrm{.}57.$ Operations Costing

$($LO

Piper Recreational Vehicles $($PRV$)$ modifies vans into recreational vehicles. PRV offers two models, the XC$-2$ and XC$-6,$ which differ in the quality of the basic van and the workmanship and machining detail that are used. The following data reflect expected operations for the next year.

$\backslash$table$[[,$XC$-2,$XC$-6,$Total$],[$Number assembled,$54,39,93],[$Materials cost per RV$,$$$40,000,$$$70,000,],[$Other costs:,,,$$905,550],[$Direct labor,,,$735,120],[$Depreciation$.,,,633,180],[$Miscellaneous costs,,,$]]$L

$7\mathrm{.}55.$ Analysis of Overhead Using a Predetermined Rate

Whitlock Manufacturing uses a job costing accounting system for its production costs. The com$-$

$($LO $7-2,3)$ pany uses a predetermined overhead rate based on direct materials costs to apply overhead to individual jobs. The company prepared an estimate of overhead costs at different volumes for the current year as follows:

$\backslash$table$[[$Direct materials costs,$$300,000,$$$400,000,$$ $500,000],[$Variable overhead costs,$$432,000,$$$576,000,$$ $720,000],[$Fixed overhead costs,$384,000,384,000,384,000],[$Total overhead,$$816,000,$$$960,000,$$$1,104,000]]$

Whitlock expects to spend $$400,000$ in direct materials costs over the entire year. The following information is for May, when Jobs WM$-52$ and WM$-53$ were completed:

$\backslash$table$[[$Inventories$,$ May $1],[$Materials and supplies,$ $2,600],[$Work in process $($Job WM$-52),13,500],[$Finished goods,$28,100],[$Purchases of materials and supplies$],[$Materials$,$$ $33,800],[$Supplies$,3,800],[$Materials and supplies requisitioned for production$],[$Job WM$-52.,$$ $11,300],[$Job WM$-53.,9,400],[$Job WM$-54.,6,400],[$Supplies$,1,500],[,$$ $28,600],[$Factory direct labor$-$hours $($DLH$)],[$Job WM$-52................,],[$Job WM$-53.,750$ DLH$],[$Job WM$-54.,500$ DLH$],[$Labor costs $$47\mathrm{.}300$