Question
Job Costs Using Activity-Based Costing Reider Company is a job-order costing firm that uses activity-based costing to apply overhead to jobs. Reider identified three overhead
Job Costs Using Activity-Based Costing
Reider Company is a job-order costing firm that uses activity-based costing to apply overhead to jobs. Reider identified three overhead activities and related drivers. Budgeted information for the year is as follows:
Activity | Cost | Driver | Amount of Driver | |
Materials handling | $72,000 | Number of moves | 3,000 | |
Engineering | 165,000 | Number of change orders | 10,000 | |
Other overhead | 280,000 | Direct labor hours | 50,000 |
Reider worked on four jobs in July. Data are as follows:
Job 13-43 | Job 13-44 | Job 13-45 | Job 13-46 | |
Beginning balance | $20,300 | $19,800 | $2,300 | $0 |
Direct materials | $6,500 | $8,900 | $12,700 | $9,800 |
Direct labor cost | $18,000 | $20,000 | $32,000 | $2,400 |
Number of moves | 44 | 52 | 29 | 5 |
Number of change orders | 30 | 40 | 20 | 20 |
Direct labor hours | 900 | 1,000 | 1,600 | 120 |
By July 31, Jobs 13-43 and 13-44 were completed and sold. Jobs 13-45 and 13-46 were still in process.
Required:
1. Calculate the activity rates for each of the three overhead activities. Round all activity rates to the nearest cent.
Materials handling rate | $fill in the blank 50e339f68feff9c_1 per move |
Engineering rate | $fill in the blank 50e339f68feff9c_2 per change order |
Other overhead rate | $fill in the blank 50e339f68feff9c_3 per direct labor hour |
2. Prepare job-order cost sheets for each job showing all costs through July 31.
If an amount is zero, enter "0".
Job 13-43 | Job 13-44 | Job 13-45 | Job 13-46 | |
Balance, July 1 | $fill in the blank f46b3dfef046ff6_1 | $fill in the blank f46b3dfef046ff6_2 | $fill in the blank f46b3dfef046ff6_3 | $fill in the blank f46b3dfef046ff6_4 |
Direct materials | fill in the blank f46b3dfef046ff6_5 | fill in the blank f46b3dfef046ff6_6 | fill in the blank f46b3dfef046ff6_7 | fill in the blank f46b3dfef046ff6_8 |
Direct labor cost | fill in the blank f46b3dfef046ff6_9 | fill in the blank f46b3dfef046ff6_10 | fill in the blank f46b3dfef046ff6_11 | fill in the blank f46b3dfef046ff6_12 |
Materials handling | fill in the blank f46b3dfef046ff6_13 | fill in the blank f46b3dfef046ff6_14 | fill in the blank f46b3dfef046ff6_15 | fill in the blank f46b3dfef046ff6_16 |
Engineering | fill in the blank f46b3dfef046ff6_17 | fill in the blank f46b3dfef046ff6_18 | fill in the blank f46b3dfef046ff6_19 | fill in the blank f46b3dfef046ff6_20 |
Other overhead | fill in the blank f46b3dfef046ff6_21 | fill in the blank f46b3dfef046ff6_22 | fill in the blank f46b3dfef046ff6_23 | fill in the blank f46b3dfef046ff6_24 |
Total | $fill in the blank f46b3dfef046ff6_25 | $fill in the blank f46b3dfef046ff6_26 | $fill in the blank f46b3dfef046ff6_27 | $fill in the blank f46b3dfef046ff6_28 |
Question Content Area
3. Calculate the balance in Work in Process on July 31. $fill in the blank e92f02f3d00d05d_1
4. Calculate the cost of goods sold for July. $fill in the blank e92f02f3d00d05d_2
5. What if Job 13-46 required no engineering change orders? What is the difference in the new cost of Job 13-46?
$fill in the blank e92f02f3d00d05d_3
higher lower no effect
How would the cost of the other jobs be affected?
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