Bob and Beth Ford retired from the food services industry and began catering wedding receptions on a limited basis. The major costs in setting up their business included: linens, \($1,000\); two complete silver services, \($800\) glass plates and cups, \($1,200\) and cake-decorating tools and accessories, \($400.\) It is expected that all of the above items will last 10 years with no salvage value. Bob and Beth do all their food preparation in their apartment and have found that in an average month the utility bill is \($100\) higher than when they did not cater. All baking and cooking supplies are treated as “direct materials,” and the only other cost incurred is liability insurance at \($1,200\) per year. All direct materials are purchased at a local grocery for cash, and Bob and Beth pay themselves an hourly wage of \($25\) per hour. During the month of June, Bob and Beth catered five weddings.

The overhead allocation base is labor hours with an estimated 1,000 hours per year, and billings are at 120 percent of job cost. Overhead allocations and markups are rounded to the nearest dollar.

Required
a. Prepare job cost sheets for each of the five catering jobs.
b. Calculate income for the month of June.

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Materials Labor Hours Redfern wedding $ 350 20 Miller wedding 700 35 Walker wedding 425 18 DeSilva wedding 1,500 80 Estes wedding 550 28