Haslett Corporation uses standard costs with its job order cost accounting system. In January, an order (Job No. 12) for 1,900 units of Product B was received. The standard cost of one unit of Product B is as follows.
| Direct materials |
|
2 pounds at $1.00 per pound |
|
$ 2.00 |
| Direct labor |
|
2.00 hour at $8 per hour |
|
16.00 |
| Overhead |
|
2 hours (variable $4.50 per machine hour; fixed $2.50 per machine hour) |
|
14.00 |
| Standard cost per unit |
|
|
|
$32.00 |
Normal capacity for the month was 4,100 machine hours. During January, the following transactions applicable to Job No. 12 occurred.
| 1. |
|
Purchased 4,256 pounds of raw materials on account at $1.05 per pound. |
| 2. |
|
Requisitioned 4,256 pounds of raw materials for Job No. 12. |
| 3. |
|
Incurred 3,895 hours of direct labor at a rate of $7.91 per hour. |
| 4. |
|
Worked 3,895 hours of direct labor on Job No. 12. |
| 5. |
|
Incurred manufacturing overhead on account $33,120. |
| 6. |
|
Applied overhead to Job No. 12 on basis of standard machine hours allowed. |
| 7. |
|
Completed Job No. 12. |
| 8. |
|
Billed customer for Job No. 12 at a selling price of $150,100. |