....... makes custom wood tables and utilizes a job-order costing system. The following standard cost

information is available with respect to the production of one type X office desk and shelf

combination:

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JOB 123, from a specialty furniture retailer, called for the production of 10 Type X office desk

systems. JOB 678 from a different retailer called for the production of 12 of these same desks.

In all of the situations below, assume that all costs are already charged to the jobs in

question; that is, as costs are incurred, they are charged to the job (recorded on the job cost

card) in question (WIP).

REQUIRED:

1. How much is the unit cost of ONE Type X office desk? _____________________

2. How much is the expected cost of JOB 123? ___________________

3. During the production of JOB 123, 2 yards of wood were split, so that the job required more

wood and one half hour to replace these split pieces. On average, when producing desks, up

to 10% of the wood might be split as part of the production process, and accordingly, this

spoilage on JOB 123 is considered normal. The split wood

cannot

be resold and must be

discarded.

a) The correcting journal entry to account for this would be:

DR

CR

b) WHY is this the correct entry?

c) The cost of JOB123 would then be:__________________