Problem:
A job order cost sheet for Lowry Company is shown below.
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Job No. 92
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For 2,000 Units
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Date
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Direct
Materials
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Direct
Labor
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Manufacturing
Overhead
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Beg. bal. Jan. 1
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5,000
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6000
|
5100
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8
|
6,000
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|
|
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12
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8000
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6400
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25
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2,000
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|
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27
|
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4000
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3200
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13000
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18000
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14700
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Cost of completed job:
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Direct materials
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$13,000
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Direct labor
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18,000
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Manufacturing overhead
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14,700
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Total cost
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$45,700
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Unit cost ($45,700 2,000)
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$22.85
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(a) On the basis of the foregoing data, answer the following questions.
(1) What was the balance in Work in Process Inventory on January 1 if this was the only unfinished job?
(2) If manufacturing overhead is applied on the basis of direct labor cost, what overhead rate was used in each year?
(b) Prepare summary entries at January 31 to record the current year's transactions pertaining to Job No. 92.