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Managerial Accounting

Exercise 16-12
Don Lieberman and Associates, a CPA firm, uses job order costing to capture the costs of its audit jobs. There were no audit jobs in process at the beginning of November. Listed below are data concerning the three audit jobs conducted during November.

Direct materials   $700   $470   $260
Auditor labor costs   $5,720   $6,850   $3,700
Auditor hours   75   89   48

Overhead costs are applied to jobs on the basis of auditor hours, and the predetermined overhead rate is $51 per auditor hour. The Lynn job is the only incomplete job at the end of November. Actual overhead for the month was $12,290.

(a) Determine the cost of each job.

Lynn   $<input id="res_EAT_1315369348470_0_8630836796638729_1" class="rightinput" type="text" name="res_EAT_1315369348470_0_8630836796638729_1" value="" /><span id="res_EAT_1315369348470_0_8630836796638729_1_oldValue" style="display: none;">
Brian   $<input id="res_EAT_1315369348470_0_8630836796638729_003" class="rightinput" type="text" name="res_EAT_1315369348470_0_8630836796638729_003" value="" /><span id="res_EAT_1315369348470_0_8630836796638729_003_oldValue" style="display: none;">
Mike   $<input id="res_EAT_1315369348470_0_8630836796638729_005" class="rightinput" type="text" name="res_EAT_1315369348470_0_8630836796638729_005" value="" /><span id="res_EAT_1315369348470_0_8630836796638729_005_oldValue" style="display: none;">

(b) Indicate the balance of the Service Contracts in Process account at the end of November.

Balance in service contracts in process account   $<input id="_8630836796638729_accountingtextentry_50" class="rightinput" type="text" name="_8630836796638729_accountingtextentry_50" value="" /><span id="_8630836796638729_accountingtextentry_50_oldValue" style="display: none;">

(c) Calculate the ending balance of the Operating Overhead account for November.

Balance in operating overhead account   $<input id="_8630836796638729_accountingtextentry_52" class="rightinput" type="text" name="_8630836796638729_accountingtextentry_52" value="" /><span id="_8630836796638729_accountingtextentry_52_oldValue" style="display: none;">
Posted in Math, asked by Karen, 6 years ago. 3470 hits.
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