Applying Overhead to Jobs, Costing Jobs

Jagjit Company designs and builds retaining walls for individual customers. On August 1, there were two jobs in process: Job 93 with a beginning balance of $8,710 and Job 94 with a beginning balance of $7,360. Jagjit applies overhead at the rate of $9 per direct labor hour. Direct labor wages average $16 per hour. Data on August costs for all jobs are as follows:

Line Item Description	Job 93	Job 94	Job 95	Job 96
Direct materials	$930	$4,410	$3,280	$1,320
Direct labor cost	1,920	5,120	1,920	640

During August, Jobs 95 and 96 were started. Job 93 was completed on August 17, and the client was billed at cost plus 40%. All other jobs remained in process.

Required:

Question Content Area

1. Calculate the number of direct labor hours that were worked on each job in August.

Line Item Description	Direct labor hours
Job 93
Job 94
Job 95
Job 96

2. Calculate the overhead applied to each job during the month of August.

Line Item Description	Amount
Job 93
Job 94
Job 95
Job 96

Question Content Area

3. Prepare job-order cost sheets for each job as of the end of August. All amount cells must have an entry; enter zeros as needed.

Line Item Description	Job 93	Job 94	Job 95	Job 96
Beginning balance
Direct materials
Direct labor
Applied overhead
Total

Question Content Area

4. Calculate the balance in Work in Process on August 31. The work in process balance on August 31 is fill in the blank 1 of 1$.

5. What is the price of Job 93? The price of Job 93 is fill in the blank 1 of 1$.

6. Conceptual Connection: Part way through the year, Jagjit bought a bulldozer to handle larger jobs. The bulldozer cost $37,100 and is needed for larger commercial jobs. Smaller residential jobs can still be done with the smaller bobcat tractor.

Complete the statement below that outlines how the bulldozer's cost could be applied to only those jobs that need the larger equipment.

Create a separate fill in the blank 1 of 3

job, department, or company

for the acquisition and use of the bulldozer. Treat the bulldozer's depreciation, fuel, maintenance, etc. as fill in the blank 2 of 3

total budgeted, cost unit costs, or overhead expenses

. Divide this by the anticipated annual hours of use to arrive at the fill in the blank 3 of 3

overhead rate, unit cost, or fixed overhead

.