Tara Aldrin installs outdoor water gardens. On June 1, Tara had three jobs in process, for the Fazels, Myrons, and Pattons, with the following costs:
|
|
Fazel
|
Myron
|
Patton
|
|
Direct materials
|
$ 560
|
$ 270
|
$1,200
|
|
Direct labor
|
900
|
700
|
1,000
|
|
Applied overhead
|
270
|
210
|
300
|
|
Total
|
$1,730
|
$1,180
|
$2,500
|
During the month of June, two more jobs were started, the Raider and Willis houses. Materials and labor costs incurred by each job in June are as follows:
| |
Materials
|
Direct Labor
|
|
Fazel
|
$600
|
$1,200
|
|
Myron
|
350
|
980
|
|
Patton
|
260
|
650
|
|
Raider
|
780
|
1,350
|
|
Willis
|
725
|
900
|
The Fazel and Myron jobs were completed and billed by June 30.
Required
1. If overhead is applied on the basis of direct labor dollars, what is the overhead rate?
2. Prepare simple job-order cost sheets for each of the five jobs in process during June.
3. What is the ending balance of Work in Process on June 30? What is the cost of jobs sold in June? (Round your answers to the nearest dollar.)
4. Suppose that Tara prices her jobs at cost plus 40 percent. In addition, during June, marketing and administrative costs of $1,200 were incurred. Prepare an income statement for the month of June.