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 $8,690 and Job 94 with a beginning balance of $7,390. Jagjit applies overhead at the rate of $7 per direct labor hour. Direct labor wages average $17 per hour. Data on August costs for all jobs are as follows:

	Job 93	Job 94	Job 95	Job 96
Direct materials	$910	$4,450	$3,270	$1,270
Direct labor cost	1,700	5,610	2,210	680

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:

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

Job 93	fill in the blank b5539907a04906d_1 DLH
Job 94	fill in the blank b5539907a04906d_2 DLH
Job 95	fill in the blank b5539907a04906d_3 DLH
Job 96	fill in the blank b5539907a04906d_4 DLH

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

Job 93	$fill in the blank b5539907a04906d_5
Job 94	$fill in the blank b5539907a04906d_6
Job 95	$fill in the blank b5539907a04906d_7
Job 96	$fill in the blank b5539907a04906d_8

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.

Jagjit Company
Job-Order Cost Sheets
August 31
	Job 93	Job 94	Job 95	Job 96
Beginning balance	$fill in the blank f2bc7bf7cf9505e_1	$fill in the blank f2bc7bf7cf9505e_2	$fill in the blank f2bc7bf7cf9505e_3	$fill in the blank f2bc7bf7cf9505e_4
Direct materials	fill in the blank f2bc7bf7cf9505e_5	fill in the blank f2bc7bf7cf9505e_6	fill in the blank f2bc7bf7cf9505e_7	fill in the blank f2bc7bf7cf9505e_8
Direct labor	fill in the blank f2bc7bf7cf9505e_9	fill in the blank f2bc7bf7cf9505e_10	fill in the blank f2bc7bf7cf9505e_11	fill in the blank f2bc7bf7cf9505e_12
Applied overhead	fill in the blank f2bc7bf7cf9505e_13	fill in the blank f2bc7bf7cf9505e_14	fill in the blank f2bc7bf7cf9505e_15	fill in the blank f2bc7bf7cf9505e_16
Total	$fill in the blank f2bc7bf7cf9505e_17	$fill in the blank f2bc7bf7cf9505e_18	$fill in the blank f2bc7bf7cf9505e_19	$fill in the blank f2bc7bf7cf9505e_20

4. Calculate the balance in Work in Process on August 31. The work in process balance on August 31 is $fill in the blank db14e1086fc4f94_1.

5. What is the price of Job 93? The price of Job 93 is $fill in the blank db14e1086fc4f94_2.

6. CONCEPTUAL CONNECTION: Part way through the year, Jagjit bought a bulldozer to handle larger jobs. The bulldozer cost $37,300 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 bulldozers cost could be applied to only those jobs that need the larger equipment.

Create a separate (job, department, company) for the acquisition and use of the bulldozer. Treat the bulldozers depreciation, fuel, maintenance, etc. as (total budgeted cost, unit cost, overhead expenses) . Divide this by the anticipated annual hours of use to arrive at the (overhead rate, unit cost, fixed overhead) .