Golden Enterprise performs market research for consumer product companies across the country. The company conducts telephone surveys and gathers consumers together in focus groups to review foods, cleaning products, and toiletries. Golden uses a normal-costing system. General overhead is allocated to each job based on 150% of direct labor cost. Actual overhead equaled applied overhead as of April 30, 2020. Actual overhead in May was RM122,000. All costs incurred during the planning stage for a market research job and during the job are gathered in a balance sheet account called “Jobs in Progress (JIP).” When a job is completed, the costs are transferred to an income statement account called “Cost of Completed Jobs (CCJ).” Following is cost information for May 2020: From Beginning JIP Incurred in May Brand Labor General Overhead Labor Choco Jar RM18,000 RM27,000 RM16,000 Herbal Toothpaste 4,000 6,000 34,000 Green Noodles --- --- 22,400 Lemon Dish Liquid --- --- 5,600 As of May 1, there were two jobs in progress: Choco Jar and Herbal Toothpaste. The jobs for Green Noodles and Lemon Dish Liquid were started during May. The jobs for Choco Jar and Lemon Dish Liquid were completed during May. Required: Calculate JIP at the end of May. Calculate CCJ for May. Calculate under- or overapplied overhead at the end of May.

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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Golden Enterprise performs market research for consumer product companies across the country. The company conducts telephone surveys and gathers consumers together in focus groups to review foods, cleaning products, and toiletries. Golden uses a normal-costing system. General overhead is allocated to each job based on 150% of direct labor cost. Actual overhead equaled applied overhead as of April 30, 2020. Actual overhead in May was RM122,000. All costs incurred during the planning stage for a market research job and during the job are gathered in a balance sheet account called “Jobs in Progress (JIP).” When a job is completed, the costs are transferred to an income statement account called “Cost of Completed Jobs (CCJ).” Following is cost information for May 2020:

	From Beginning JIP		Incurred in May
Brand	Labor	General Overhead		Labor
Choco Jar	RM18,000	RM27,000		RM16,000
Herbal Toothpaste	4,000	6,000		34,000
Green Noodles	---	---		22,400
Lemon Dish Liquid	---	---		5,600

As of May 1, there were two jobs in progress: Choco Jar and Herbal Toothpaste. The jobs for Green Noodles and Lemon Dish Liquid were started during May. The jobs for Choco Jar and Lemon Dish Liquid were completed during May.

Required:

Calculate JIP at the end of May.
Calculate CCJ for May.
Calculate under- or overapplied overhead at the end of May.

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