Reference no: EM13570819

1. Costa Production uses a job order cost accounting system. On May 1, the company has a balance in Work in Process Inventory of $3,200 and two jobs in process: Job No. 621 $2,000, and Job No. 622 $1,200. During May, a summary of source documents reveals the following.

    Materials                      Labor

Job Number                                         Requisition Slips         Time Tickets

     621                                                      $2,500                         $2,200

     622                                                        3,500                           3,000

     623                                                        4,400                           7,600

                                                             $10,400                        $12,800

General use                                                1,000                            1,400

   $11,400                        $14,200

Costa applies manufacturing overhead to jobs at an overhead rate of 85% of direct labor cost.

Job No. 621 is completed during the month.

Instructions

Prepare summary journal entries to record:

   a) Direct and indirect materials used

b) Direct and indirect labor

   c) Manufacturing overhead applied to jobs

   d) Completion of Job No. 621.

2. The predetermined overhead rate is 60% of direct labor cost. During the month, $350,000 of factory labor costs were incurred of which $150,000 was indirect labor and $200,000 was direct labor. The amount of overhead debited to Work in Process Inventory should be:

3.Complete the table below by computing equivalent units for materials and conversion costs. Note: assume all materials are added at the beginning of the period.