Prepare Job-Order Cost Sheets, Predetermined Overhead Rate, Ending Balance of WIP, Finished Goods, and COGS

At the beginning of March, Mendez Company had two jobs in process, Job 86 and Job 87, with the following accumulated cost information:

Job 86 Job 87

Direct materials $4,800 $1,600

Direct labor 1,200 3,000

Applied overhead 888 2,220

Balance, March 1 $6,888 $6,820

During March, two more jobs (88 and 89) were started. The following direct materials and direct labor costs were added to the four jobs during the month of March:

Job 86 Job 87 Job 88 Job 89

Direct materials $3,000 $7,000 $2,100 $1,500

Direct labor 800 6,000 900 500

At the end of March, Jobs 86, 87, and 89 were completed. Only Job 87 was sold. On March 1, the balance in Finished Goods was zero.

Required:

1.Calculate the overhead rate based on direct labor cost.

%

2.Prepare a brief job-order cost sheet for the four jobs. Show the balance as of March 1 as well as direct materials and direct labor added in March. Apply overhead to the four jobs for the month of March, and show the ending balances.

Mendez Company

Job-Order Cost Sheets

For the Month ofMarch

Job 86 Job 87 Job 88 Job 89

Beginning balance, March 1

Direct materials

Direct labor

Applied overhead

Total, March 31

3.Calculate the ending balances of Work in Process and Finished Goods as of March 31.

Work in Process:

Finished Goods:

4.Calculate the Cost of Goods Sold for March. .