KidCo. Inc. is a manufacturer of furnishings for children. The company uses a job-order costing system.

KidCo's work-in-process inventory on November 30 consisted of the following jobs.

The company's November 30 finished-goods inventory, which is valued using the FIFO first-in.
first-out method, consisted of five items.

KidCo applies manufacturing overhead on the basis of direct-labor hours. The company's overhead budget for the >ear totals \($4,500,000\) . and the company plans to use 600,000 direct-labor hours during this period. Through the first 11 months of the year, a total of \($555,000\) direct-labor hours were worked.
and total overhead amounted to \($4.273.500\) .
At the end of November, the balance in KidCo's Raw -Material Inventor, account, which includes both raw material and purchased parts, was \($668.000\) . Additions to inventor, and requisitions from inventory during December included the following.

The following list shows the jobs that were completed and the unit sales for December.

Required:
1. Explain when it is appropriate for a company to use a job-order costing system.
2. Calculate the dollar balance in KidCo's Work-in-Process Inventory account as of December 31.
3. Calculate the dollar amount related to the playpens in KidCo's Finished-Goods Inventory account as of December 31.

Transcribed Image Text:

Job No. Description Units CBS102 PLP086 Cribs 20,000 Playpens 15.000 DRS114 Dressers 25.000 Total Accumulated Cost $ 900 000 420.000 250 000 $1 570 000