Activity-Based Costing, Unit Cost, Ending Work-in-Process Inventory, Journal Entries Feldspar Company uses an ABC system to apply overhead. There are three activity rates: Setting up $20 per setup Machining $5.10 per machine hour Other overhead 75% of direct labor cost During September, Feldspar worked on three jobs. Data relating to these jobs follow: Job 13-280 Job 13-281 Job 13-282 Units in each order 200 500 130 Units sold 200 130 Materials requisitioned $4,720 $3,800 $5,800 Direct labor cost $2,000 $4,700 $800 Machine hours 80 100 40 Number of setups 20 15 25 During September, Jobs 13-280 and 13-282 were completed and transferred to Finished Goods Inventory. Job 13-280 was sold by the end of the month. Job 13-281 was the only unfinished job at the end of the month. Required: Question Content Area 1. Calculate the per-unit cost of Jobs 13-280 and 13-282. Round unit cost to nearest cent. Job 13-280 $fill in the blank 2d4c52fb4054054_1 per unit Job 13-282 $fill in the blank 2d4c52fb4054054_2 per unit 2. Compute the ending balance in the work-in-process inventory account. $fill in the blank 2d4c52fb4054054_3 Feedback Area Feedback 1. Manufacturing cost comes from totaling direct materials, direct labor, and overhead on each job. The grand total can be divided by the number of units to determine per-unit cost. ABC system was used to apply Overhead. 2. Determine which jobs are still in work-in-process and compute the balance. Question Content Area 3. Prepare the journal entries reflecting (a.) the completion of Jobs 13-280 and 13-282 and (b.) the sale of Job 13-280 on account. Make the entry to record the cost of Job 13-280 first, followed by the entry to record the revenue from its sale. The selling price is 150 percent of cost. a. Finished Goods Finished Goods Work in Process Work in Process b (1). Cost of Goods Sold Cost of Goods Sold Finished Goods Finished Goods b (2). Accounts Receivable Accounts Receivable Sales Revenue Sales Revenue Feedback Area Feedback 3. The costs of a completed job are transferred from the work-in-process inventory account to the finished goods inventory account. When a job is sent to a customer, the cost of the finished job becomes the cost of the goods sold. Remember: two journal entries will show that the job was sold and billed to customer. Question Content Area 4. Suppose Feldspar has secured contracts for two new jobs in October that have simpler designs and will require fewer setups than average. How can the activity-based rates help the company anticipate costs in October and revenue and income when the new jobs are complete? Identify the data analytic types (descriptive, diagnostic, predictive, or prescriptive) that will help Feldspar answer these questions. (See Exhibit 2.5 and Exhibit 2.6 for a review of data analytic types. Note: More than one analytic type might apply.) Descriptive analysis will help Feldspar determine the costs of the jobs by applying the anticipated setups times the setup rate. Diagnostic analysis will help Feldspar determine why the costs are lower than average, and the revenue will also be lower than average. Feedback Area Feedback Correct Feedback Area Feedback Partially correct Check My Work PreviousNext