Corey spent the month of December talking to various suppliers in order to figure out how much all of the components of his business would cost. He added cost information to the information in the table below. Equipment, Materials and other Costs Cost Standard per Statue Resin Molds $2,500 n/a Processing Machine $5,000 n/a Packaging Machine $2,000 n/a Golden Wolves Logo T-shirts $75 for 100 1 Resin $100 for 25 pounds 1 lb for small statues and 2 lbs for large statues Small Packaging box $12.50 for 50 boxes 1 box Large Packaging box $20 for 50 boxes 1 box Business Licenses $200/year Rent $600/month IPad Point of Sale System $1,000 Point of Sale Software $30/month Utilities (gas, electric and water) $60/month Business Cell Phone $80/month Salary – Corey $500/month Carl’s Pay $10/hour 20 minutes per statue Julie’s Pay $10/hour 5 minutes per statue Accountant’s pay $200/month Supervisor’s pay $100/month Cost Information Assume that Corey decided to use a Job Order Costing system. Golden Wolves Statue Company’s plantwide predetermined overhead rate uses direct labor-hours as the allocation base. Corey pays Carl and Julie the hourly wage specified in the table above. During the first year of operations, the company started and completed three large jobs for 3 different retailers. One retailer wanted only small profile statues, another wanted only large profile statues and the third wanted the large forward-facing statues. Some of the details of each job are as follows: Job 1: Small profile statues, Carl worked 240 direct labor-hours Job 2: Large profile statues, 1080 statues were completed, Manufacturing Overhead Applied equals $3,240. Job 3: Forward facing statues with t shirts, 900 statues were completed Assignment: Complete the job cost sheets for the three jobs by calculating the Direct materials, Direct labor and Manufacturing overhead applied for each of the 3 jobs given the information in the cost table above and calculate the plantwide predetermined overhead rate. (Hint: For Step 1, using the cost table and the information given, calculate the total amount of Direct Labor and number of statues produced in each job. For Step 2, calculate the Plantwide Predetermined Overhead rate using Job 2 once you have calculated the total direct labor cost. For Step 3, calculate the manufacturing overhead applied using the plantwide predetermined overheard rate and the information that you already calculated. For Step 4, determine the cost of material per statue from the cost table and then apply it to the number of statues completed.) Job 1: Small Profile Statues 1. Direct materials 2. Direct Labor 3. Manufacturing overhead applied 4. Total job cost 5. # of Statues completed Job 2: Large Profile Statues 6. Direct materials 7. Direct Labor 8. Manufacturing overhead applied $3,240 9. Total job cost 10. # of Statues completed 1080 Job 3: Large Forward Facing Statues 11. Direct materials 12. Direct Labor 13. Manufacturing overhead applied 14. Total job cost 15. # of Statues completed 900
Corey spent the month of December talking to various suppliers in order to figure out how much all of the components of his business would cost. He added cost information to the information in the table below.
|
Equipment, Materials and other Costs |
Cost |
Standard per Statue |
|
Resin Molds |
$2,500 |
n/a |
|
Processing Machine |
$5,000 |
n/a |
|
Packaging Machine |
$2,000 |
n/a |
|
Golden Wolves Logo T-shirts |
$75 for 100 |
1 |
|
Resin |
$100 for 25 pounds |
1 lb for small statues and 2 lbs for large statues |
|
Small Packaging box |
$12.50 for 50 boxes |
1 box |
|
Large Packaging box |
$20 for 50 boxes |
1 box |
|
Business Licenses |
$200/year |
|
|
Rent |
$600/month |
|
|
IPad Point of Sale System |
$1,000 |
|
|
Point of Sale Software |
$30/month |
|
|
Utilities (gas, electric and water) |
$60/month |
|
|
Business Cell Phone |
$80/month |
|
|
Salary – Corey |
$500/month |
|
|
Carl’s Pay |
$10/hour |
20 minutes per statue |
|
Julie’s Pay |
$10/hour |
5 minutes per statue |
|
Accountant’s pay |
$200/month |
|
|
Supervisor’s pay |
$100/month |
|
Cost Information
Assume that Corey decided to use a
Job 1: Small profile statues, Carl worked 240 direct labor-hours
Job 2: Large profile statues, 1080 statues were completed, Manufacturing Overhead Applied equals $3,240.
Job 3: Forward facing statues with t shirts, 900 statues were completed
Assignment: Complete the job cost sheets for the three jobs by calculating the Direct materials, Direct labor and Manufacturing overhead applied for each of the 3 jobs given the information in the cost table above and calculate the plantwide predetermined overhead rate. (Hint: For Step 1, using the cost table and the information given, calculate the total amount of Direct Labor and number of statues produced in each job. For Step 2, calculate the Plantwide Predetermined Overhead rate using Job 2 once you have calculated the total direct labor cost. For Step 3, calculate the manufacturing overhead applied using the plantwide predetermined overheard rate and the information that you already calculated. For Step 4, determine the cost of material per statue from the cost table and then apply it to the number of statues completed.)
|
Job 1: Small Profile Statues |
|
|
1. Direct materials |
|
|
2. Direct Labor |
|
|
3. Manufacturing overhead applied |
|
|
4. Total job cost |
|
|
5. # of Statues completed |
|
|
Job 2: Large Profile Statues |
|
|
6. Direct materials |
|
|
7. Direct Labor |
|
|
8. Manufacturing overhead applied |
$3,240 |
|
9. Total job cost |
|
|
10. # of Statues completed |
1080 |
|
Job 3: Large Forward Facing Statues |
|
|
11. Direct materials |
|
|
12. Direct Labor |
|
|
13. Manufacturing overhead applied |
|
|
14. Total job cost |
|
|
15. # of Statues completed |
900 |
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