Read Chapter 5 in Cornerstones of Cost Management and the following instructional material.

Salazar Company is a job-order costing firm that uses activity-based costing to apply overhead to jobs. Salazar identified three overhead activities and related drivers. Budgeted information for the year is as follows:

Activity	Cost	Driver	Amount of Driver
Setting up design	$156,000	Setups	1,200
Purchasing	187,500	Number of parts	15,000
Other overhead	420,000	Direct labor hours	50,000

Salazar worked on five jobs in March. Data are as follows:

	Job 15	Job 16	Job 17	Job 18	Job 19
Balance, March 1	$34,500	$39,890	$24,090	$0	$0
Direct materials	$28,000	$37,900	$25,350	$11,000	$13,560
Direct Labor	$10,000	$8,500	$23,000	$12,900	$8,000
Setups	20	14	35	8	15
Number of parts	150	180	200	500	300
Direct labor hours	650	580	1,600	870	520

By March 31, Jobs 15, 16, and 17 were completed and sold. The remaining jobs were in process.

Required:

1. Calculate the activity rates for each of the three overhead activities.

2. Prepare job-order cost sheets for each job showing all costs through March 31. What is the cost of each job by the end of March?

3. Calculate the balance in Work in Process on March 31.

4. Calculate the cost of goods sold for March

Read Chapter 5 in Cornerstones of Cost Management and the following instructional material.

Salazar Company is a job-order costing firm that uses activity-based costing to apply overhead to jobs. Salazar identified three overhead activities and related drivers. Budgeted information for the year is as follows:

Activity	Cost	Driver	Amount of Driver
Setting up design	$156,000	Setups	1,200
Purchasing	187,500	Number of parts	15,000
Other overhead	420,000	Direct labor hours	50,000

Salazar worked on five jobs in March. Data are as follows:

	Job 15	Job 16	Job 17	Job 18	Job 19
Balance, March 1	$34,500	$39,890	$24,090	$0	$0
Direct materials	$28,000	$37,900	$25,350	$11,000	$13,560
Direct Labor	$10,000	$8,500	$23,000	$12,900	$8,000
Setups	20	14	35	8	15
Number of parts	150	180	200	500	300
Direct labor hours	650	580	1,600	870	520

By March 31, Jobs 15, 16 and 17 were completed and sold. The remaining jobs were in process.

Required:

1. Calculate the activity rates for each of the three overhead activities.

2 . Prepare job-order cost sheets for each job showing all costs through March 31. What is the cost of each job by the end of March?

3. Calculate the balance in Work in Process on March 31.

4 . Calculate the cost of goods sold for March

1.	Predetermined overhead rates
		Setup rate =	Estimated overhead	=		=
		We estimated engineering hrs.
	Purchasing rate =	Estimated overhead	=		=
	We estimated machine hrs.
	Other OH rate =	Estimated overhead	=		=
	Direct labor hrs.
2.	JOB-ORDER COST SHEET
	Job 15
	DIRECT MATERIALS	DIRECT LABOR	OVERHEAD
	Req. No.	Amount	Ticket	Hours	Rate	Amount	Rate	Activity	Amount
			$28,000				$10,000	$130.00
									$130.00
									$130.00
									$ -
						COST SUMMARY
						Balance, March 1	$ 34,500
						Direct Materials	28,000
						Direct Labor	10,000
						Overhead
						Total cost	$ 72,500
	JOB-ORDER COST SHEET
	Job 16
	DIRECT MATERIALS	DIRECT LABOR	OVERHEAD
	Req. No.	Amount	Ticket	Hours	Rate	Amount	Rate	Activity	Amount
									$ -
						COST SUMMARY
						Balance, March 1	$ 39,890
						Direct Materials
						Direct Labor	-
						Overhead
						Total cost	$ 39,890
	JOB-ORDER COST SHEET
	Job 17
	DIRECT MATERIALS	DIRECT LABOR	OVERHEAD
	Req. No.	Amount	Ticket	Hours	Rate	Amount	Rate	Activity	Amount
									$ -
						COST SUMMARY
						Balance, March 1	$ 24,090
						Direct Materials
						Direct Labor	-
						Overhead
						Total cost	$ 24,090
	JOB-ORDER COST SHEET
	Job 18
	DIRECT MATERIALS	DIRECT LABOR	OVERHEAD
	Req. No.	Amount	Ticket	Hours	Rate	Amount	Rate	Activity	Amount
									$ -
						COST SUMMARY
						Balance, March 1	$ -
						Direct Materials
						Direct Labor	-
						Overhead
						Total cost	$ -
	JOB-ORDER COST SHEET
	Job 19
	DIRECT MATERIALS	DIRECT LABOR	OVERHEAD
	Req. No.	Amount	Ticket	Hours	Rate	Amount	Rate	Activity	Amount
									$ -
						COST SUMMARY
						Balance, March 1	$ -
						Direct Materials
						Direct Labor	-
						Overhead
						Total Cost	$ -
3 & 4.	Select from Job Nos. from drop-down lists. Only balances will be graded.
					Work in Process			Cost of Goods Sold Ending Balance
					Ending Balance
			Jobs		Balances			Jobs		Balances
			Total		$ -
								Total		$ -