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?