JOB-ORDER COSTING Garden-R-US Inc. manufactures lawn equipment. The business uses a job-order system because the products are manufactured in batches rather than a continuous basis. The balances in selected general-ledger accounts for the eleven-month period ended November 30, 2024 are presented below: Materials inventory Work-in-process inventory Finished goods inventory Factory overhead control Cost of goods sold $ 32,000 1,200,000 2,785,000 2,260,000 14,200,000 The work-in-process inventory consists of two jobs: Accumulated Job No. Units Items Cost 3005-5 3006-4 48,000 40,000 Estate Sprinklers Economy Sprinklers $ 700,000 500,000 $1,200,000 The finished goods inventory consists of five items: Items Estate sprinklers Deluxe sprinklers Brass nozzles Rainmaker nozzles Connectors Quantity and Unit Cost 5,000 units @ $22 each 115,000 units @ $17 each 10,000 units @ $14 5,000 units @ $16 100,000 units @ $5. per gross per gross per gross The factory cost budget prepared for the 2024 is presented below: Factory Cost Annual Budget for the year ended Dec 31, 2024. Accumulated Cost $ 110,000 1,955,000 140,000 80,000 500,000 $2,785,000 Direct Materials Purchased Parts Direct Labor (400,000 hours). $ 3,800,000 6,000,000 4,000,000 Overhead Supplies $190,000 Indirect labor 700,000 Supervision 250,000 Depreciation 950,000 Utilities 200,000 Insurance 10,000 Property taxes 40,000 Miscellaneous 60,000 2,400,000 $16,200,000 The company applies factory overhead on the basis of direct labor hours. The actual activities during the first eleven months of the year were quite close to the budget. A total of 367,000 hours have been worked through Nov 30, 2024. The December 2024 transactions are summarized below: 1. All direct materials, purchased parts, and supplies are charged to materials inventory. The December purchases were as follows: Direct materials Purchased parts. Supplies $410,000 285,000 13,000 2. The direct materials, purchased parts, and supplies were requisitioned from materials inventory as shown in the table below. Purchased Parts Materials Supplies Total Requisitions 3005-5 3006-4 $110,000 $100,000 $ $210,000 4001-3 (30,000 gross of rainmaker nozzles) 6,000 181,000 6,000 181,000 4002-1 (10,000 deluxe 92,000 sprinklers) 4003-5 (50,000 ring 163,000 sprinklers) Supplies $273,000 92,000 163,000 $379,000 20,000 $20,000 20,000 $672,000 3. The payroll summary for the December is as follows: Job No. Hours Cost 3005-5 3006-4 6,000 2,500 $ 62,000 4001-3 18,000 26,000 182,000 4002-1 500 5,000 4003-5 5,000 52,000 Indirect 8,000 60,000 Supervision 24,000 Sales & administration 120,000 $531,000 4. Other factory costs incurred during December 2024 were: Depreciation $ 62,000 Utilities Insurance 15,000 1,000 Property Taxes 4,000 Miscellaneous 5,000 $ 87,000

Mesa Aquatics, Inc. estimated direct labor hours as 1,900 in quarter 1, 2,000 in quarter 2.2,200 in quarter 3, and 1,800 in quarter 4. a sales and administration budget using the information provided.

Wyandotte Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 256,900, direct labor cost was 176,000, and overhead cost was 308,400. There were 40,000 units produced. Required: 1. Calculate the total cost of direct materials used in production. 2. Calculate the cost of goods manufactured. Calculate the unit manufacturing cost. 3. Of the unit manufacturing cost calculated in Requirement 2, 6.62 is direct materials and 7.71 is overhead. What is the prime cost per unit? Conversion cost per unit?

Prepare a cost of goods sold budget for MacLaren Manufacturing Inc. for the year ended December 31, 2016, from the following estimates. Inventories of production units: Direct materials purchased during the year, 548,000; beginning inventory of direct materials, 36,000; and ending inventory of direct materials, 23,000. Totals from other budgets included:

Rockford Company has four departmental accounts: Building Maintenance, General Factory Overhead, Machining, and Assembly. The direct labor hour method is used to apply factory overhead to the jobs being worked on in Machining and Assembly. The company expects each production department to use 30,000 direct labor hours during the year. The estimated overhead rates for the year include the following: During the year, both Machining and Assembly used 28,000 direct labor hours. Factory overhead costs incurred during the year follow: In determining application rates at the beginning of the year, cost allocations were made as follows, using the sequential distribution method: Building Maintenance to: General Factory Overhead, 10%; Machining, 50%; Assembly, 40%. General factory overhead was distributed according to direct labor hours. Required: Determine the under- or overapplied overhead for each production department. (Hint: First you must distribute the service department costs.)

Corazon Manufacturing Company has a purchasing department staffed by five purchasing agents. Each agent is paid 28,000 per year and is able to process 4,000 purchase orders. Last year, 17,800 purchase orders were processed by the five agents. Required: 1. Calculate the activity rate per purchase order. 2. Calculate, in terms of purchase orders, the: a. total activity availability b. unused capacity 3. Calculate the dollar cost of: a. total activity availability b. unused capacity 4. Express total activity availability in terms of activity capacity used and unused capacity. 5. What if one of the purchasing agents agreed to work half time for 14,000? How many purchase orders could be processed by four and a half purchasing agents? What would unused capacity be in purchase orders?

Direct labor hours are estimated as 2,000 in Quarter 1; 2,100 in Quarter 2; 1,900 in Quarter 3; and 2,300 in Quarter 4. Prepare a manufacturing overhead budget using the information provided.

Business Specialty, Inc., manufactures two staplers: small and regular. The standard quantities of direct labor and direct materials per unit for the year are as follows: The standard price paid per pound of direct materials is 1.60. The standard rate for labor is 8.00. Overhead is applied on the basis of direct labor hours. A plantwide rate is used. Budgeted overhead for the year is as follows: The company expects to work 12,000 direct labor hours during the year; standard overhead rates are computed using this activity level. For every small stapler produced, the company produces two regular staplers. Actual operating data for the year are as follows: a. Units produced: small staplers, 35,000; regular staplers, 70,000. b. Direct materials purchased and used: 56,000 pounds at 1.5513,000 for the small stapler and 43,000 for the regular stapler. There were no beginning or ending direct materials inventories. c. Direct labor: 14,800 hours3,600 hours for the small stapler and 11,200 hours for the regular stapler. Total cost of direct labor: 114,700. d. Variable overhead: 607,500. e. Fixed overhead: 350,000. Required: 1. Prepare a standard cost sheet showing the unit cost for each product. 2. Compute the direct materials price and usage variances for each product. Prepare journal entries to record direct materials activity. 3. Compute the direct labor rate and efficiency variances for each product. Prepare journal entries to record direct labor activity. 4. Compute the variances for fixed and variable overhead. Prepare journal entries to record overhead activity. All variances are closed to Cost of Goods Sold. 5. Assume that you know only the total direct materials used for both products and the total direct labor hours used for both products. Can you compute the total direct materials and direct labor usage variances? Explain.

If a factory operates at 100% of capacity one month, 90% of capacity the next month, and 105% of capacity the next month, will a different cost per unit be charged to the work-in-process account each month for factory overhead assuming that a predetermined annual overhead rate is used?

Kimber Company has the following unit costs for the current year: Fixed manufacturing cost is based on an annual activity level of 8,000 units. Based on these data, the total manufacturing cost expected to be incurred to manufacture 9,000 units in the current year is: a. 560,000. b. 575,000. c. 615,000. d. 630,000.