Question

At the end of May, Bergan Company had completed Jobs 200 and 305. Job 200 is for 2,390 units, and Job 305 is for 2,053 units. The following data relate to these two jobs: On May 7, Bergan Company purchased on account 10,000 units of raw materials at $8 per unit. During May, raw materials were requisitioned for production as follows: 7,500 units for Job 200 at $8 per unit and 1,480 units for Job 305 at $5 per unit. During May, Bergan Company accumulated 2,500 hours of direct labor costs on Job 200 and 3,000 hours on Job 305. The total direct labor was incurred at a rate of $28 per direct labor hour for Job 200 and $24 per direct labor hour for Job 305. Bergan Company estimates that total factory overhead costs will be $620,000 for the year. Direct labor hours are estimated to be 80,000.

(a) Determine the balance on the job cost sheets for Jobs 200 and 305 at the end of May.
(b) Determine the cost per unit for Jobs 200 and 305 at the end of May. If required, round your answers to two decimal places.

Answer 1

Instructions are listed below.

Step-by-step explanation:

Giving the following information:

Job 200:

2,390

Direct materials= 7,500 units at $8

Direct labor= 2,500 hours at $28 per hour

Job 305:

2,053 units.

Direct material= 1,480 units at $5 per unit.

Direct labor= 3,000 hours at $24 per direct labor hour.

Bergan Company estimates that total factory overhead costs will be $620,000 for the year. Direct labor hours are estimated to be 80,000.

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= 620,000/80,000= $7.75

A)

Job 200:

Total cost= 7,500*8 + 2,500*28 + 7.75*2,500= $149,375

Job 305:

Total cost= 1,480*5 + 3,000*24 + 7.75*3,000= $102,650

B) Job 200:

Unitary cost= 149,375/2,390= $62.5

Job 305:

Unitary cost= 102,650/2,053= $50