Basic Closet Company manufactures stand-alone cedar-lined wardrobe closets. Basic received Obj. 3 an order for ten specially
Question:
Basic Closet Company manufactures stand-alone cedar-lined wardrobe closets. Basic received Obj. 3 an order for ten specially designed wardrobes to be delivered in eight weeks. The order was assigned job number 293. During production of the wardrobes, the following activities took place:
1. Requisitioned \(\$ 2,500\) of wood and \(\$ 500\) of hardware.
2. Time sheets revealed direct labor costs of \(\$ 1,450\) and indirect labor costs of \(\$ 345\).
3. Overhead was assigned using a predetermined overhead rate of \(130 \%\) of direct labor costs.
4. Completed units were shipped to the customer. The selling price was \(140 \%\) of cost.
a. Calculate the manufacturing cost of one wardrobe.
b. Calculate the selling price of each wardrobe.
c. Describe how Basic traces material, manufacturing overhead, and labor costs to job 293.
Step by Step Answer:
Managerial Accounting Information For Decisions
ISBN: 9780324222432
4th Edition
Authors: Thomas L. Albright , Robert W. Ingram, John S. Hill