On March 1 a dressmaker starts work on three custom-designed wedding dresses. Th

Question

On March 1 a dressmaker starts work on three custom-designed wedding dresses. The company uses job order costing and applies overhead to each job (dress) at the rate of 40% of direct materials costs. During the month, the jobs used direct materials as shown below. Job 1 Job 2 Job 3 $5,000 $7,000 $1,500 Direct materials used During the month, the jobs used direct labor as shown below. Jobs 1 and 3 are not finished by the end of March, and Job 2 is finished but not sold by the end of March Job 1 Job 2 Job 3 $9,000 $4,000 $3,000 Direct labor used 1. Determine the amounts of direct materials, direct labor, and factory overhead applied that would be reported on job cost sheets for each of the three jobs for March. JOB COST SHEET Job 1 Job 2 Job 3 Direct materials Direct labor Factory overhead Total 0 S

Explanation / Answer

1 Job 1 Job 2 Job 3 Direct materials 5000 7000 1500 Direct labor 9000 4000 3000 Factory overhead 2000 2800 600 Total 16000 13800 5100 2 Work in the Process inventory account = 16000+5100 = $21100 3 Finished goods inventory account = $13800

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