A job order costing system is used when a company produces a product or provides a service that is unique-that is, the cost of one product or service is different than that of another. A Job order costing must be able to identify each individual job and accumulate its costs separately from the costs of other jobs. In manufacturing, the jobs may be for a single item or a batch of similar items. The flowchart illustrates the flow of costs into Work in Process and Finished Goods in a job order costing system. Cost Flows in a Job Cost System Materials Work in Process-Assembly Dept Work in Process- Test & Packaging Dept Finished Goods Beg Inventory + Purchases Direct Materials End Inventory Job#1, Job#2 Job#3, Job#4 Beg Inventory Cost of Units + Direct Materials transferred out + Direct Labor Job#1,#2,#3,#4 + Factory Overhead applied Job#1,#2,#3,#4 End Inventory Job#4 Job#1, Job#2 Job#3 Beg Inventory Cost of Units + Cost of units transferred out transferred in + Direct Labor Job#1,#2,#3 + Factory Overhead applied Job#1,#2,#3 End Inventory Job#2,#3 Job#1 Beg Inventory + Cost of units Cost of Goods transferred in Sold End Inventory Job#1 Factory Overhead Actual Factory Overhead: + utilities expense Factory overhead + depreciation of machinery applied + supplies Costs to date by job are shown. Source: Job Cost Sheets: Job#1 Job#2 Job#3 Job#4 Direct materials $ 740 $ 570 $ 400 $ 360 Direct labor 110 100 100 120 Overhead 150 120 110 145 $ 1,000 $ 790 $ 610 $ 625 Use the flow chart to complete the following sentences. The ending inventory balance in the Work in Process-Assembly Dept is $fill in the blank fd424bff404eff4_1 The cost of goods transferred into the Work in Process-Test & Packaging Dept is $fill in the blank fd424bff404eff4_2 The cost of goods transferred out of the Work in Process- Test & Packaging Dept Dept is $fill in the blank fd424bff404eff4_3 The ending inventory balance in the Work in Process- Test & Packaging Dept is $fill in the blank fd424bff404eff4_4 A is the primary document for accumulating all costs related to a specific job. Materials are recorded to jobs based on a materials requisition and labor is charged to jobs based on a timecard, or labor accumulation system. Overhead is applied based on a . The rate may be based on direct labor hours, machine hours, or another activity. It may be a dollar amount or a percentage. Assume the company has estimated overhead costs for the coming year of $1,120,000 and expected activity is 80,000 direct labor hours. The formula for calculating the overhead rate is: Overhead rate = Estimated overhead costs = $fill in the blank c69ecbf97f9e025_3 Activity fill in the blank c69ecbf97f9e025_4 direct labor hours = $fill in the blank c69ecbf97f9e025_5 per direct labor hour Overhead is applied to jobs based on this rate. It is likely that the actual overhead costs and activity level will be different than the estimated overhead cost and estimated activity level. The result is an amount of over/under applied overhead that is expensed to cost of goods sold. APPLY THE CONCEPTS: Job Order Costing At the beginning of the year, Carentan Company estimated the following: Machining Department Assembly Department Total Overhead $324,000 $247,500 $571,500 Direct labor hours 130,000 150,000 280,000 Machine hours 180,000 - 180,000 Carentan uses departmental overhead rates. In the machining department, overhead is applied on the basis of machine hours. In the assembly department, overhead is applied on the basis of direct labor hours. Actual data for the month of January are as follows: Machining Department Assembly Department Total Overhead $25,000 $24,600 $49,600 Direct labor hours 10,000 14,000 24,000 Machine hours 15,000 - 15,000 Complete the following table: If required, round your answers to the nearest cent. Machining Department Assembly Department Predetermined overhead rate $fill in the blank a22862009fc0ffa_1 per machine hour $fill in the blank a22862009fc0ffa_2 per direct labor hour Overhead applied in January fill in the blank a22862009fc0ffa_3 fill in the blank a22862009fc0ffa_4 Variance fill in the blank a22862009fc0ffa_5 fill in the blank a22862009fc0ffa_6 Over-or-underapplied