Basic Closet Company manufactures stand-alone cedar-lined wardrobe closets. Basic received Obj. 3 an order for ten specially

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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.

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Managerial Accounting Information For Decisions

ISBN: 9780324222432

4th Edition

Authors: Thomas L. Albright , Robert W. Ingram, John S. Hill

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