The Runtechnology Corporation, began operations on February 1. It employs a job-
ID: 2417546 • Letter: T
Question
The Runtechnology Corporation, began operations on February 1. It employs a job-order costing system. Overhead is charged at a normal rate of $3.80 per direct labor hour. The actual operations for the month of February are summarized as follows:
Job No.
Units
Material
Direct
labor cost
Direct
labor hours
101
10,000
$6,000
$16,000
1,300
102
8,800
3,200
15,800
1,050
103
16,000
7,500
19,000
1,260
104
8,000
3,000
14,800
980
105
20,000
9,000
13,600
850
$7,500
14,000
Required: Compute the following dollar ($) balances on February 29:
Explanation / Answer
Direct Direct Material Qty Used @1.5/pc Overhead applied @3.8/DLH Total Job Cost Closing Stock status Job No. Units Material labor cost labor hours 101 10,000 $6,000 $16,000 1,300 4,000.0 4,940.00 26,940.00 sold 102 8800 3200 15800 1,050 2,133.3 3,990.00 22,990.00 Finished goods 103 16,000 7500 19000 1,260 5,000.0 4,788.00 31,288.00 sold 104 8000 3000 14800 980 2,000.0 3,724.00 21,524.00 Finished goods 105 20,000 9000 13600 850 6,000.0 3,230.00 25,830.00 WIP Total 19,133.33 20,672.00 a Material Inventory Details Qty Rate Amt $ Purchased 35,000 1.50 52,500 Material Used 19,133.3 1.50 28,700 Closing Balance 15,866.7 23,800 b WIP Inventory Amt $ Job 105 25,830 c Finished Goods Inventory Job Amt $ Job 102 22,990 Job 104 21,524 Total FG Inventory 44,514 d Cost Of goods sold Job Amt $ Job 101 26,940 Job 103 31,288 Total COGS 58,228 e Overhead Incurred 21,500 Overhead applied 20,672 Ovehead Underapplied 828.00
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