Compute the overhead allocation rate for 2016

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Reference no: EM133381453

Case: BRIEF EXERCISE 3-2 Using Job-Order Costing Documents [LO2 - CC4] Cycle Gear Corporation has incurred the following costs on job W456, an order for 20 special sprockets to be delivered at the end of next month: Direct materials: • On April 10, requisition number 15673 was issued for 40 titanium blanks to be used in the special order. The blanks cost $15 each. • On April 11, requisition number 15678 was issued for 420 hardened nibs also to be used in the special order. The nibs cost $1.25 each. Direct labour: • On April 12, Jamie Unser worked from 11:00 a.m. until 2:45 p.m. on job W456. He is paid $12.60 per hour. • On April 18, Melissa Chan worked from 8:15 a.m. until 11:30 a.m. on job W456. She is paid $13.20 per hour. Required: 1. On what documents would these costs be recorded? 2. How much cost should have been recorded on each of the documents for job W456? EXERCISE 3-1 Prepar Job Cost Sheet [LO2 - CC4] Help Me Solve It Tutorial: Exercise 3-1 Watch this first. https://connect.mheducation.com/connect/hmEBook.do?setTab=sectio Biotechnologies Unlimited, Inc. (BUI), located in Sydney, Nova Scotia, is a small but growing biotech quality analysis organization that tests pesticides before they are used by farmers. The testing procedures are specific to the individual pesticides used because reagents used for testing react differently based on their composition and the quantity used. How they are introduced into the pesticides for testing is also important. During the month of December 2016, it completed one job (reference number: KS 2016-337); records pertaining to this job are as follows: Date Document Amount 2/12/16 M-3316 $ 890 4/12/16 L-4423 230 11/12/16 L-4437 530 13/12/16 M-3399 1,750 20/12/16 M-3407 200 22/12/16 L-4509 700 The documents with the references M and L pertain to direct materials and direct labour, respectively. BUI currently allocates overhead using direct labour cost as the allocation base. For the year 2016, it estimated $590,000 as the overhead amount and $472,000 for direct labour costs.

Required: 1. Compute the overhead allocation rate for 2016.

2. Compute the total costs of the job (show direct materials, direct labour, and overhead as separate line items).

3. Prepare a job cost sheet for job KS 2016-337 (use Exhibit 3-4 as a guide).

Reference no: EM133381453

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