1.
Concept introduction:
The total estimated cost for the job.
2.
Concept introduction:
Job costing: Job costing refers to the method of costing which is based on a particular project where all the costs and revenues are being tracked for every project or job. Here, all the costs like direct material, direct labor, overheads, etc are separately written down, and then important decisions and assumptions are made.
The price quoted by the company with a markup of 10% above the total cost.
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- Review Question 1Manufacturing Overhead Allocation Base and Calculating the Cost of Jobs.Pyramid Company expects to incur $3,000,000 in manufacturing overhead costs this year. During theyear, it expects to use 40,000 direct labor hours at a cost of $600,000 and 80,000 machine hours.Required:a. Prepare a predetermined overhead rate based on direct labor hours, direct labor cost, andmachine hours.b. Why might Pyramid Company prefer to use machine hours to allocate manufacturing overhead?c. Using each of the predetermined overhead rates calculated in part a and the data that follows forjob 128, determine the cost of job128.Direct materials $6,000Direct labor $4,000 (200 hours at $15 per hour) + (100 hours at $10 per hour)Machine time 700 hoursarrow_forwardto the balance in Finished Goods? What would happen to the balance of Cost of Goods pay he Job by JU 30? What would happen Sold? Cornerstone Exercise 5.3 Job Costs Using Activity-Based Costing Heitger Company is a job-order costing firm that uses activity-based costing to apply overhead to jobs. Heitger identified three overhead activities and related drivers. Budgeted information for the year is as follows: Activity Cost Driver Amount of Driver Materials handling Engineering Other overhead $ 72,000 165,000 280,000 Number of moves 3,000 10,000 Number of change orders Direct labor hours 50,000 Heitger worked on four jobs in July. Data are as follows: Job 13-43 Job 13-44 Job 13-45 Job 13-46 $ 2,300 $12,700 $32,000 %24 $9,800 $2,400 (continued) $ Beginning balance Direct materials $20,300 $ 6,500 $19,800 $ 8,900 $20,000 $18,000 Direct labor costarrow_forwardMarkup on Cost, Job Pricing Privacy Window and Wall Treatments Company provides draperies, shades, and various window treatments. Privacy works with the customer to design the appropriate window treatment, places the order, and installs the finished product. Direct materials and direct labor costs are easy to trace to the jobs. Privacy's income statement for last year is as follows: Revenues $235,500 Cost of goods sold: Direct materials $120,105 Direct labor 40,035 Overhead 28,260 188,400 Gross profit $47,100 Selling and administrative expenses 26,300 Operating income $20,800 Privacy wants to find a markup on cost of goods sold that will allow them to earn about the same amount of profit on each job as was earned last year. Required: 1. What is the markup on cost of goods sold (COGS) that will maintain the same profit as last year? (Round to the nearest whole percent. Use this amount for future…arrow_forward
- Markup on Cost, Job Pricing Privacy Window and Wall Treatments Company provides draperies, shades, and various window treatments. Privacy works with the customer to design the appropriate window treatment, places the order, and installs the finished product. Direct materials and direct labor costs are easy to trace to the jobs. Privacy's income statement for last year is as follows: Revenues $236,500 Cost of goods sold: Direct materials $120,615 Direct labor 40,205 Overhead 28,380 189,200 Gross profit $47,300 Selling and administrative expenses 28,900 Operating income $18,400 Privacy wants to find a markup on cost of goods sold that will allow them to earn about the same amount of profit on each job as was earned last year. Required: 1. What is the markup on cost of goods sold (COGS) that will maintain the same profit as last year? (Round to the nearest whole percent. Use this amount for future…arrow_forwardJob Alpha requires $4,000 of direct material, $3,600 of direct labour and 120 direct labour hours. Manufacturing overhead is applied at $60 per direct labour hour. What is the cost of Job Alpha? O $4,000 O $7,600 O $14,800 O $16,500arrow_forward6. Job order cost sheets show the following costs assigned to each job: Job 13 Job 14 Job 15 Direct materials $7,560 $1,525 $3,290 Direct labor 3,760 3,824 3,796 The company assigns overhead at $1.25 for each direct labor dollar spent. What is the total cost for each of the jobs? Total cost for Job 13 = ? Total cost for Job 14 = ? Total cost for Job 15 = ? PLEASE NOTE: All amounts rounded to whole dollar and shown with "$" and commas as needed (i.e. $12,345).arrow_forward
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