Your Tired, Inc. is a service firm that uses a job-order costing system and applies office overhead to jobs on the basis of direct staff costs. The following costs were recorded in January:
- Cost of subcontracted work (comparable to direct material) 300,000
- Direct staff costs 100,000
- Office overhead (comparable to manufacturing overhead applied) 160,000
- Cost of work completed (comparable to cost of goods manufactured) 520,000
There were no beginning inventories in January. At the end of January, only one job was still in progress. This job (Marble Slab Tombstones) had been charged with $9,000 in direct staff costs.
Required:
1] Compute the predetermined overhead rate that was used in January.
2] Compute the following job cost sheet for the partially completed Marble Slab Tombstones project;
Job Cost Sheet
- Marble Slab Tombstones Project
- Cost of subcontracted work .
- Direct staff costs .
- Office overhead applied .
- Total costs to January 31