For the year ended December 31,2030, Jane Inc. incurred the following cost on Job Order 01 for manufacturing of 1,000 units: Original cost accumulation Direct Materials: 1,000,000 Direct Labor: 800,000 Factory Overhead: 200,000 Direct Cost of reworking 100 Units: Direct Materials: 200,000 Direct Labor: 400,000 1.What is the cost per unit of Job 01 if the rework cost were attributable to the exacting specification of Job order 01? 2. What is the cost per unit of Job 01 if the rework cost were attributable to internal failure?

For the year ended December 31,2030, Jane Inc. incurred the following cost on Job Order 01 for manufacturing of 1,000 units: Original cost accumulation Direct Materials: 1,000,000 Direct Labor: 800,000 Factory Overhead: 200,000 Direct Cost of reworking 100 Units: Direct Materials: 200,000 Direct Labor: 400,000 1.What is the cost per unit of Job 01 if the rework cost were attributable to the exacting specification of Job order 01? 2. What is the cost per unit of Job 01 if the rework cost were attributable to internal failure?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

For the year ended December 31,2030, Jane Inc. incurred the following cost on Job Order 01 for manufacturing of 1,000 units:

Original cost accumulation

Direct Materials: 1,000,000

Direct Labor: 800,000

Factory Overhead: 200,000

Direct Cost of reworking 100 Units:

Direct Materials: 200,000

Direct Labor: 400,000

1.What is the cost per unit of Job 01 if the rework cost were attributable to the exacting specification of Job order 01?

2. What is the cost per unit of Job 01 if the rework cost were attributable to internal failure?

Definition Definition Indirect costs incurred while producing goods or services. Overhead costs cannot be directly attributed to products or services. Overhead includes indirect material cost, indirect labor cost, rent, utilities expenses, and depreciation. Since these costs directly affect the profitability of a company, managing overhead becomes an important task for management.

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