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As of the end of June, the job cost sheets at Racing Wheels, Inc., show the following total costs accumulated on three custom jobs |
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Job 102 |
Job 103 |
Job 104 |
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Direct materials |
$ 15,000 |
$ 33,000 |
$ 27,000 |
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Direct labor |
8,000 |
14,200 |
21,000 |
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Overhead applied |
4,000 |
7,100 |
10,500 |
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Job 102 was started in production in May and the following costs were assigned to it in May: direct materials, $6,000; direct labor, $1,800; and overhead, $900. Jobs 103 and 104 are started in June. Overhead cost is applied with a predetermined rate based on direct labor cost. Jobs 102 and 103 are finished in June, and Job 104 is expected to be finished in July. No raw materials are used indirectly in June. Using this information, answer the following questions. (Assume this company’s predetermined overhead rate did not change across these months. |
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1&2. |
Complete the table below to calculate the cost of the raw materials requisitioned and direct labor cost incurred during June for each of the three jobs. |
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3. |
What predetermined overhead rate is used during June? |
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Accounts receivable
Average raw materials inventory
Cost of goods sold
Estimated direct labor
Estimated overhead costs
Net sales
Raw materials used
How much total cost is transferred to finished goods during June?
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