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art 1: Job Costing Crandall Corporation makes portable enclosures for festivals, concerts, and other events Its products aren't mass produced-each unit is made to customer
art 1: Job Costing Crandall Corporation makes portable enclosures for festivals, concerts, and other events Its products aren't mass produced-each unit is made to customer specifications. Crandal employs a normal job costing system. Direct labor at the company is compensated at a rate of $21 per hour, however, employees receive no pay when they aren't working on jobs. A predetermined rate based on direct labor-hours is used to assign manufacturing overhead to jobs In the past two years, the company incurred manufacturing overhead costs (adjusted for price-level changes using current prices and wage rates) as follows: Year 1 Year 2 Direct labor-hours worked 144,000 118,000 Manufacturing overhead costs incurred: Indirect labor Employee benefits Power Heat and light Supervision Depreciation Property taxes and insurance Total manufacturing overhead costs $4,580,000 2,204,000 858,000 620,000 244,000 598,000 2,370,000 945,000 $12,419,000 $5,603,340 3,134,000 1,367.400 987 420 210,870 721,970 2,370,000 945,000 $15,340,000 At the start of Year 3, Crandall has two jobs not yet delivered to customers. Job AT-360 was completed on December 15, Year 2. It's scheduled to ship out on January 21, Year 3. Job AT-365 is still in progress. The predetermined rate in Year 2 was $155 per direct labor-hour Data on direct material costs and direct labor-hours for these jobs in Year 2 was as follows: Job AT-360 $680,000 4,800 hours Job AT-365 $947,000 6,200 hours Direct material costs Direct labor-hours During Year 3, Crandall incurred direct material costs and direct labor-hours for all jobs worked in Year 3, including the completion of Job AT-365, as follows: $15,780,000 150,000 $18,609.400 Direct material costs Direct labor-hours Actual manufacturing overhead
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