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NWT Consultants, located in Yellowknife, Northwest Territories, is a small but growing business that analyzes a variety of construction materials before they are used by

NWT Consultants, located in Yellowknife, Northwest Territories, is a small but growing business that analyzes a variety of construction materials before they are used by contractors. The testing procedures are specific to the individual materials used because reagents used for testing react differently based on their composition and the quantity used. How they are introduced into the materials for testing is also important.

During the month of December 2021, NWT completed 36 different jobs. Records pertaining to one such job (reference number: MT Q421-442) are as follows:

Date Document Amount
2/12/21 M-3316 $ 720
4/12/21 L-4423 356
11/12/21 L-4437 160
13/12/21 M-3399 830
20/12/21 M-3407 130
22/12/21 L-4509 580

The documents with the references M and L pertain to direct materials and direct labour, respectively. NWT currently allocates overhead using direct labour cost as the allocation base. For the year 2021, it estimated $646,380 as the overhead amount and $486,000 for direct labour costs.

Required: 1. Compute the overhead allocation rate for 2021.

2. Compute the total costs of the job.

DIRECT MATERIALS

DIRECT LABOUR

OVERHEAD

TOTAL COSTS

3.Prepare a job cost sheet for job MT Q421-442.

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