st of a Manufactured Product- Job Costing System ay 1,2016, erez has incurred th
ID: 2516456 • Letter: S
Question
st of a Manufactured Product- Job Costing System ay 1,2016, erez has incurred the following costs for each of the jobs listed below. Perez uses the Job Order Cost system. STINER ALTON HERMAN DM 2220 2,800 2132 599 TOTAL: 6,531 DM 1,150 DL FOH TOTAL: 2550 DL FOH 1,348 1,011 TOTAL: $ 4,579 DL 800 TOTAL 000 During May, Perez incurs the following costs below. Perez begins one job during the month of May (Smith) and completes the other three during the course of the month Stiner, Alton, and Herman). Factory Overhead is charged to jobs on the basis of $.75 per dollar of direct labor hours. MATERIALS REQUISITIONS FOH (APPLIED) TIME TICKETS STINER S ALTON S HERMAN S 420.00 $ 660.00 $ 2480.00$ 1,90000 $ 460.00 1,400.00 1,348.00 2,42000 SMITH $ J actual fot nda applid sa t on eross et Endirect Moteriels Enelire c Lbother FOH 1, 800.00 Endireut 3756.ocExplanation / Answer
It is assumed that Actual FOB Cost given in the question is for May month.
Total Actual FOH Costs = indirect materiasl $1400 + Indirect Labor $1750 + Other FOH $1800 = $4,950
Total Applied FOH Costs during May = Stiner $345 + ALton $1050 + Herma $1011 + Smith (2420*0.75)
= $4,221
Here, applied FOB costs is less than Actual FOB costs, it means the applied FOH costs are UNDER APPLIED by $729 (4950 - 4221).
UNDER APPLIED FOH COSTS = $729
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