Job order costing (15 Marks)

Malcom Company designs and builds retaining walls for individual customers. On 1 August, there were two jobs in process: job 93 with a beginning balance of $8750 and job 94 with a beginning balance of $7300. Malcom applies overhead at the rate of $8 per direct labour hour. Direct labour wages average $18 per hour. Data on August cost for all jobs are as follows:

Job 93          Job 94        Job 95     Job 96

Direct Materials          $ 950            $4500         $3300       $1300

Direct Labour               2160             5400           2610           900

During August Job 95 and 96 were started. Job 93 was completed on 17 August and the client was billed at cost plus 25%. All other jobs remained in process.

Required:

• Calculate the number of direct labour hours that were worked on each job in August (2 Marks)

• Calculate the overhead applied to each job during the month of August (2 Marks)

• Prepare job order cost sheets for each job as of the end of August (6 Marks)

• Calculate the balance in work in process on 31 August (4 Marks)

• What is the price of job 93? (1 Marks)