Job & Process Costing Billowy Materials Company makes various pillow fill for a wide variety of resellers. Because of the semi-custom nature of Billowly's production, Billowly has traditionally used a job costing system in each of its three manufacturing departments. Manufacturing overhead is currently being applied to jobs on the basis of direct labor costs in the fabrication department, direct labor hours in the preparation department, and machine hours in the finishing department. For the current year, the following estimates had been generated by management based on a recent period's results and expectations for changes in market demand. Manufacturing Overhead Direct labor costs Direct labor hours Machine hours Fabrication $1,050,000 $1,500,000 100,000 400,000 Department Preparation $1,500,000 $1,250,000 125,000 500,000 Finishing $840,000 $450,000 40,000 120,000 Please refer to the department and job cost records data file for job-specific cost and pricing information (where appropriate), as well as manufacturing overhead incurred in each department, for the current month. Note that a blank selling price reflects a job that is still in process, which will also be denoted in the status field. Using the estimates above and the job cost records data, answer the following: 1) What was the predetermined overhead rate for each department? 2) What were the total manufacturing costs assigned to jobs in each department this month? 3) What was the under-or over-applied overhead for each department at the end of the month? What might this tell you about the full year overhead estimates in each department? 4) What was the total cost of ending work in process inventory & total cost of goods sold? 5) What was the overall gross margin of Billowy for the period? Some of Billowy's upper-level managers believe that Billowy's orders have become decreasingly customized in recent periods, and that the products leaving the production facilities are more and more similar. One of Billowy's executives believes the company could simplify its costing sytem as a result, and switch to a process costing system encompassing all three departments together. Assume there were no jobs in process at the start of the period. With this in mind, determine the following: 1) The equivalent units of production for materials and conversion. 2) The unit costs of production for materials and conversion 3) The assignment of costs to units transferred out to finished goods) and in process at the end of the period. 4) Please also prepare a cost reconciliation report for this combined process. 5) Do you see any evidence in the job cost data to suggest that the exec's claim of more and more "standard" products has merit? Why or why not? 12:34 PM Sun Sep 22 65% ACCT3030-Mini-Case-2-data-set Draw Formulas Data Home Insert Review View Calibri (Body) 11 BI U B A = 35 hotz de I fx ANT_I_IMI C HIAR Pwanampir M e M ad applied My Ord suured Merced_applied Mg Chad Aplied Morerad red Crest Walna PCTad an 251 4300 2634668 3 Frishing 100 Completed LOO Completed Diest Materia MOd applied Mg Chad App Drus bar 100 Compied My Ord applied LOD Completed S Fabrik My Ord Aulod 6 Finishing 100 C old M ad Applied My Ord Applied TP 8 haribon ET M d Applied M Chad App M. Orad applied MOLAR 1 P1 Me Asad Apple 5265112 11 Fration Mod Applied DST shor 13 inchi Notes and Dept Infor... Job Cost Summaries + 12:34 PM Sun Sep 22 65% Home View ACCT3030-Mini-Case-2-data-set Draw Formulas Data Review = Calibri (Body) 11 Insert I B A A meteo to _!! My Ord als 13 Para 1 F aria Dres Materia erced_applied M 22 F Mg Chad Aiad Mit O dpplied Dres Malanes Diest Water Applied Mg Chad App Dres bar 25 Tabrication 15 tkanin M arted applied 35 Fishing My Ord Ayo 2. Prepara 32 latriction 1 Fatrication Mgrad Applied My Order MOd applied KAROS M Chapad ari Milorad Applied MO _Aulis Mg Orad_pplied Notes and Dept Infor... Job Cost Summaries +. Job & Process Costing Billowy Materials Company makes various pillow fill for a wide variety of resellers. Because of the semi-custom nature of Billowly's production, Billowly has traditionally used a job costing system in each of its three manufacturing departments. Manufacturing overhead is currently being applied to jobs on the basis of direct labor costs in the fabrication department, direct labor hours in the preparation department, and machine hours in the finishing department. For the current year, the following estimates had been generated by management based on a recent period's results and expectations for changes in market demand. Manufacturing Overhead Direct labor costs Direct labor hours Machine hours Fabrication $1,050,000 $1,500,000 100,000 400,000 Department Preparation $1,500,000 $1,250,000 125,000 500,000 Finishing $840,000 $450,000 40,000 120,000 Please refer to the department and job cost records data file for job-specific cost and pricing information (where appropriate), as well as manufacturing overhead incurred in each department, for the current month. Note that a blank selling price reflects a job that is still in process, which will also be denoted in the status field. Using the estimates above and the job cost records data, answer the following: 1) What was the predetermined overhead rate for each department? 2) What were the total manufacturing costs assigned to jobs in each department this month? 3) What was the under-or over-applied overhead for each department at the end of the month? What might this tell you about the full year overhead estimates in each department? 4) What was the total cost of ending work in process inventory & total cost of goods sold? 5) What was the overall gross margin of Billowy for the period? Some of Billowy's upper-level managers believe that Billowy's orders have become decreasingly customized in recent periods, and that the products leaving the production facilities are more and more similar. One of Billowy's executives believes the company could simplify its costing sytem as a result, and switch to a process costing system encompassing all three departments together. Assume there were no jobs in process at the start of the period. With this in mind, determine the following: 1) The equivalent units of production for materials and conversion. 2) The unit costs of production for materials and conversion 3) The assignment of costs to units transferred out to finished goods) and in process at the end of the period. 4) Please also prepare a cost reconciliation report for this combined process. 5) Do you see any evidence in the job cost data to suggest that the exec's claim of more and more "standard" products has merit? Why or why not? 12:34 PM Sun Sep 22 65% ACCT3030-Mini-Case-2-data-set Draw Formulas Data Home Insert Review View Calibri (Body) 11 BI U B A = 35 hotz de I fx ANT_I_IMI C HIAR Pwanampir M e M ad applied My Ord suured Merced_applied Mg Chad Aplied Morerad red Crest Walna PCTad an 251 4300 2634668 3 Frishing 100 Completed LOO Completed Diest Materia MOd applied Mg Chad App Drus bar 100 Compied My Ord applied LOD Completed S Fabrik My Ord Aulod 6 Finishing 100 C old M ad Applied My Ord Applied TP 8 haribon ET M d Applied M Chad App M. Orad applied MOLAR 1 P1 Me Asad Apple 5265112 11 Fration Mod Applied DST shor 13 inchi Notes and Dept Infor... Job Cost Summaries + 12:34 PM Sun Sep 22 65% Home View ACCT3030-Mini-Case-2-data-set Draw Formulas Data Review = Calibri (Body) 11 Insert I B A A meteo to _!! My Ord als 13 Para 1 F aria Dres Materia erced_applied M 22 F Mg Chad Aiad Mit O dpplied Dres Malanes Diest Water Applied Mg Chad App Dres bar 25 Tabrication 15 tkanin M arted applied 35 Fishing My Ord Ayo 2. Prepara 32 latriction 1 Fatrication Mgrad Applied My Order MOd applied KAROS M Chapad ari Milorad Applied MO _Aulis Mg Orad_pplied Notes and Dept Infor... Job Cost Summaries +