Jack's Water Slides makes custom water slides for hotels. On October 1, there were three jobs in process: Jobs 812, 813, and 814. Two more jobs were started during October: Jobs 815 and 816. By October 31, Jobs 812, 814, and 816 were finished. The following data has been collected: Job 812 Job 813 Job 814 Job 815 Job 816 10/1 Balance (BWIP) $500 $900 $780 --- --- Direct materials 400 270 1,140 $300 $300 Direct labor 300 180 600 400 800 Overhead is applied at the rate of 110% of direct labor cost. Jobs are sold at cost plus 50%. Selling and administrative expenses for October totaled $3,000. By October 31, Jobs 812 and 816 are sold, but the customer who ordered Job 814 decided he did not want the slide, so it is still in the warehouse. What is the selling price of Job 816?
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
| Job 812 | Job 813 | Job 814 | Job 815 | Job 816 | |
| 10/1 Balance (BWIP) | $500 | $900 | $780 | --- | --- |
| Direct materials | 400 | 270 | 1,140 | $300 | $300 |
| Direct labor | 300 | 180 | 600 | 400 | 800 |
Overhead is applied at the rate of 110% of direct labor cost. Jobs are sold at cost plus 50%. Selling and administrative expenses for October totaled $3,000. By October 31, Jobs 812 and 816 are sold, but the customer who ordered Job 814 decided he did not want the slide, so it is still in the warehouse.
What is the selling price of Job 816?
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