To build your own tree house you use:

• $10,000 of direct material.
• 400 hours of direct labor ($10/hour)
• Manufacturing overhead, applied on the basis of direct labor hours at a rate of $15/direct labor hour)

Assume that you started a company that builds treehouses, complete the following requirements:

Requirement 1: Students will create a Job Order Costing spreadsheet in Excel (with formulas) using the data presented in the video.

Requirement 2: Using the Excel spreadsheet, complete a Job Order Costing spreadsheet for the following two customers:

John Smith ordered five tree houses

Jane Doe ordered three tree houses

Requirement 3: Questions to be answered:

1. What is the total cost for John Smiths order?

2. What is the total cost for Jane Does order?

3. Explain what a job costing system is.

4. List at least 6 items that is included in Direct Materials (items needed to build the tree house).

that is included in Manufacturing Overhead (items needed by employees so they can build the tree house).

Job Order Costing Spreadsheet Example:

ABC Tree Houses Company
Job Costing Sheet
		Job Number:
		Customer Name:
	Number of Tree Houses	Direct Materials Costs (per tree house):	Direct Labor Costs (per tree house):	Manufacturing Overhead Costs (per tree house):
	1
	2
	3
	4
	5
	Total Costs:
		Cost Summary (for entire order):	Total Amount:
		Direct Materials Costs:
		Direct Labor Costs:
		Manufacturing Overhead Costs:
		Total Cost of Order: