Sigma Corporation applies overhead cost to jobs on the basis of direct labor cost. Job V, which was started and completed during the current period, shows charges of $5,000 for direct materials, $8,000 for direct labor, and $6,000 for overhead on its job cost sheet. Job W, which is still in process at year-end, shows charges of $2,500 for direct materials and $4,000 for direct labor.

Required:

1a. Should any overhead cost be applied to Job W at year-end?

multiple choice 1

• Yes

• No

1b. How much overhead cost should be applied to Job W?