Question

On March 9, 2018, Job XX4 was completed. The job cost sheet showed a total of $6,000 in direct materials and $8,000 in direct labor at a rate of $20 per direct labor hour. Factory overhead is applied at $30 per direct labor hour. The debit to Finished Goods Inventory to record the completion of Job XX4 is

(A) $11,000.
(B) $17,000.
(C) $26,000.
(D) $6,000.

Answer 1

Answer:

(C) $26,000.

Explanation:

The debit to Finished Goods Inventory to record the completion of Job XX4 is the total cost for Job XX4 completion;

The job cost sheet showed $8,000 in direct labor at a rate of $20 per direct labor hour, then the total labor hour taken is 400 hours (= $8,000/ $20)

Factory overhead is applied at $30 per direct labor hour, then the total overhead is $12,000 (= 400 hours x $30 per hour)

The total cost = direct materials + direct labor + overhead = $6,000 + $8,000 + $12,000 = $26,000