Foster Enterprises makes custom-order draperies. In late 2009, when managers prepared the budget for 2010, they estimated that manufacturing overhead would total $100,000. Because the production process is labor intensive, overhead is allocated to jobs based on direct labor hours. Managers expected total direct labor hours to amount to 400,000 hours. During March and April of 2010, employees worked on only three jobs. Relevant information for each job follows:
|
Monthly Data Recorded |
Job 76 |
Job 77 |
Job 78 |
|
March |
|||
|
Direct materials cost |
$12,986 |
||
|
Direct labor cost |
$35,880 |
||
|
Direct labor hours |
3,680 |
||
|
April |
|||
|
Direct materials cost |
$ 0 |
$10,855 |
$6,250 |
|
Direct labor cost |
$ 9,750 |
$22,800 |
$2,730 |
|
Direct labor hours |
1,000 |
2,400 |
280 |
;Job 76 was started in March, finished in April, and delivered to the customer in the same month. Job 77 was started in April, finished in April, and delivered to the customer in May. Job 78 was started in April and finished in May.
- What predetermined overhead rate will the company use for all jobs worked on during 2010?
- Compute the cost of each job (don”t forget to allocate overhead).
- What was the Work in Process Inventory balance on March 31? On April 30?
- What was cost of goods manufactured for April?
- What was cost of goods sold for April?