Job Order Cost Sheet Remnant Carpet Company sells and installs commercial carpeting for office buildings. Remnant Carpet Company uses a job order cost system. When a prospective customer asks for a price quote on a job, the estimated cost data are inserted on an unnumbered job cost sheet. If the offer is accepted, a number is assigned to the job, and the costs incurred are recorded in the usual manner on the job cost sheet. After the job is completed, reasons for the variances between the estimated and actual costs are noted on the sheet. The data are then available to management in evaluating the efficiency of operations and in preparing quotes on future jobs. On October 1, Remnant Carpet Company gave Jackson Consulting an estimate of $9,450 to carpet the consulting firm's newly leased office. The estimate was based on the following data: Estimated direct materials: $7,000 200 meters at $35 per meter Estimated direct labor: 16 hours at $20 per hour Estimated factory overhead (75% of direct labor cost) 320 240 Total estimated costs $7,560 1,890 Markup (25% of production costs) Total estimate $9,450 On October 3, Jackson Consulting signed a purchase contract, and the delivery and installation were completed on October 10. The related materials requisitions and time tickets are summarized as follows: Materials Requisition No. Description Amount 112 $4,900 140 meters at $35 68 meters at $35 114 2,380 Time Ticket No. Description Amount H10 10 hours at $20 $200 H11 10 hours at $20 200 Required: Enter amounts as positive numbers. 1. Complete that portion of the job order cost sheet that would be prepared when the estimate is given to the customer. Time Ticket No. Description Amount H10 10 hours at $20 10 hours at $20 $200 200 H11 Required: Enter amounts as positive numbers. 1. Complete that portion of the job order cost sheet that would be prepared when the estimate is given to the customer. 2. Record the costs incurred, and complete the job order cost sheet. JOB ORDER COST SHEET Customer Jackson Consulting Date Date wanted Date completed Job. No. ESTIMATE October 1 October 10 October 10 Direct Materials Direct Labor Summary Amount Amount Amount 200 Meters at $35 16 Hours at $20 Direct Materials Direct Labor Factory Overhead Total Total Total cost ACTUAL Summary Direct Materials Description Mat. Reg. No. Description Direct Labor Description Amount Amount Time Ticket No. Time Ticket No. Description Amount am Item Amount Direct Materials Learning Objective 2 Date wanted October 10 Date completed October 10 Job. No. ESTIMATE Direct Materials Direct Labor Summary Amount Amount Amount 200 Meters at $35 16 Hours at $20 Direct Materials Direct Labor Factory Overhead Total Total Total cost ACTUAL Direct Labor Direct Materials Summary Mat. Reg. No. Description Amount Time Ticket No. Description Amount Item Amount Direct Materials 140 Meters at $35 10 Hours at $20 Direct Labor 68 Meters at $35 H11 10 Hours at $20 Factory Overhead Total Cost Total $ Total Feedback Check My Work What is the best explanation for the variances between actual costs and estimated costs. (For this purpose, assume that the additional meters of material used in the job were spoiled, the factory overhead rate has proven to be satisfactory, and an inexperienced employee performed the work.)
