EXERCISE $3-12$ Applying Overhead Cost to a Job LO$3-2$

Sigma Corporation applies overhead cost to jobs on the basis of direct labor cost. Job V$,$ which

was started and completed during the current period, shows charges of $$5,000$ for direct

materials, $$8,000$ for direct labor, and $$6,000$ for overhead on its job cost sheet. Job W$,$ which

is still in process at year$-$end, shows charges of $$2,500$ for direct materials and $$4,000$ for direct

labor.

Required:

Should any overhead cost be applied to Job W at year$-$end? If so$,$ how much? Explain.

How will the costs included in Job W$\text{'}$s job cost sheet be reported within Sigma

Corporation's financial statements at the end of the year?