2 Pribil Farm Equipment is a joborder costing manufacturer t

2. Pribil Farm Equipment is a job-order costing manufacturer that uses a plantwide overhead rate based on direct labor hours. Estimations for the year include $420,000 in Overhead and 30,000 direct labor hours. Pribil worked on five jobs in March. Data are as follows: 2Job 90 Job 93 $0 8,210 4,860 972 Job 89 Job 91 Job 92 Balance, 3/1 Direct Materials Direct Labor cost Direct Labor Hours $0 17,210 22,90015,240 11,500 16,250 9.750 1,950 $23,110 $18,240 S9,510 13,000 8,075 1,615 2,300 3,250 By March 31, Jobs 89 and 91 were com jobs remained in process. pleted and sold at Cost plus 55%. The rest of the Calculate the plantwide overhead rate. A) Create Job Cost Reports for the month B) Calculate the Work-in-Process on March 31 FG and COGS. C) Income Statement for the Month of March

Solution

Plant wide Overhead Rate

(A) Total Overheads in the year

$   420,000.00

(B) Total Direct labor hours in the year

$      30,000.00

(A/B) Plant wide Overhead Rate per labor hour

$              14.00

Part A

Job Cost Report

Job 89

Job 90

Job 91

Job 92

Job 93

Opening WIP

$      23,110.00

$ 18,240.00

$    9,510.00

$                 -  

$                 -  

Direct Material

$      13,000.00

$ 17,210.00

$ 22,900.00

$ 15,240.00

$   8,210.00

Direct Labor cost

$        8,075.00

$ 11,500.00

$ 16,250.00

$    9,750.00

$    4,860.00

Allocated Overhead (14*Labor Hours)

$      22,610.00

$ 32,200.00

$ 45,500.00

$ 27,300.00

$ 13,608.00

Total Cost

$      66,795.00

$ 79,150.00

$ 94,160.00

$ 52,290.00

$ 26,678.00

Part B

Work in progress

Job 90

$      79,150.00

Job 92

$      52,290.00

Job 93

$      26,678.00

Total Work in Progress

$   158,118.00

Finished Goods

$ 0*

*There are no goods in Finished stock

Cost of Goods Sold

Job 89

$      66,795.00

Job 91

$      94,160.00

Total Cost of Goods Sold

$   160,955.00

Part C

Income Statement

sales

$   249,480.25

Cost of Goods Sold

$   160,955.00

Net Income

$      88,525.25

Calculation of sales

(cogs+55%)

(160955+55%)

$   249,480.25

Plant wide Overhead Rate

(A) Total Overheads in the year

$   420,000.00

(B) Total Direct labor hours in the year

$      30,000.00

(A/B) Plant wide Overhead Rate per labor hour

$              14.00

Part A

Job Cost Report

Job 89

Job 90

Job 91

Job 92

Job 93

Opening WIP

$      23,110.00

$ 18,240.00

$    9,510.00

$                 -  

$                 -  

Direct Material

$      13,000.00

$ 17,210.00

$ 22,900.00

$ 15,240.00

$   8,210.00

Direct Labor cost

$        8,075.00

$ 11,500.00

$ 16,250.00

$    9,750.00

$    4,860.00

Allocated Overhead (14*Labor Hours)

$      22,610.00

$ 32,200.00

$ 45,500.00

$ 27,300.00

$ 13,608.00

Total Cost

$      66,795.00

$ 79,150.00

$ 94,160.00

$ 52,290.00

$ 26,678.00

Part B

Work in progress

Job 90

$      79,150.00

Job 92

$      52,290.00

Job 93

$      26,678.00

Total Work in Progress

$   158,118.00

Finished Goods

$ 0*

*There are no goods in Finished stock

Cost of Goods Sold

Job 89

$      66,795.00

Job 91

$      94,160.00

Total Cost of Goods Sold

$   160,955.00

Part C

Income Statement

sales

$   249,480.25

Cost of Goods Sold

$   160,955.00

Net Income

$      88,525.25

Calculation of sales

(cogs+55%)

(160955+55%)

$   249,480.25

Plant wide Overhead Rate
(A) Total Overheads in the year	$   420,000.00
(B) Total Direct labor hours in the year	$      30,000.00
(A/B) Plant wide Overhead Rate per labor hour	$              14.00