Question

The computer workstation furniture manufacturing that Santana Rey started in January is progressing well. As of the end of June, Business Solutions's job cost sheets show the following total costs accumulated on three furniture jobs.
Job 602 Job 603 Job 604
Direct materials $ 1,500 $ 3,700 $ 2,800
Direct labor 900 1,380 1,800
Overhead 360 552 720
Job 602 was started in production in May, and these costs were assigned to it in May: direct materials, $600; direct labor, $250; and overhead, $100. Jobs 603 and 604 were started in June. Overhead cost is applied with a predetermined rate based on direct labor costs. Jobs 602 and 603 are finished in June, and Job 604 is expected to be finished in July. No raw materials are used indirectly in June. (Assume this company’s predetermined overhead rate did not change over these months.)
Required:1. What is the cost of the raw materials used in June for each of the three jobs and in total?2. How much total direct labor cost is incurred in June?3. What predetermined overhead rate is used in June?4. How much cost is transferred to finished goods inventory in June? (Leave no cell blank enter "0" wherever required.)

Answer 1

Answer:

Results are below.

Explanation:

Giving the following information:

Job 602 Job 603 Job 604

Direct materials= $ 1,500 $ 3,700 $ 2,800

Direct labor= 900 1,380 1,800

Overhead= 360 552 720

Job 602:

direct materials= $600

direct labor= $250

overhead= $100.

1) Raw materials:

Job 602= 1,500 - 600= $900

Job 603= 3,700

Job 604= 2,800

Total= $7,400

2) Direct labor:

Job 602= 900 - 250= $650

Job 603= 1,380

Job 604= 1,800

Total= $3,830

3) Overhead:

Job 602= 350 - 100= 250

Job 603= 552

Job 604= 720

Total= $1,522

4) The cost transferred to finished goods is the total cost of jobs 602 and 603.

Total cost 602= 1,500 + 900 + 360= 2,760

Total cost 603= 3,700 + 1,380 + 552= $5,632

Total cost transferred to finished goods= 2,760 + 5,632= $8,392