As of the end of June, the job cost sheets at Racing Wheels, Inc., show the following total costs accumulated on three custom jobs.

As of the end of June, the job cost sheets at Racing Wheels, Inc., show the following total costs accumulated on three custom jobs.

 

	Job 102	Job 103	Job 104
Direct materials	$ 26,000	$ 73,000	$ 55,000
Direct labor	12,000	27,200	41,000
Overhead	5,160	11,696	17,630

 

Job 102 was started in production in May and the following costs were assigned to it in May: direct materials, $14,000; direct labor, $2,900; and overhead, $1,247. Jobs 103 and 104 are started in June. Overhead cost is applied with a predetermined rate based on direct labor cost. Jobs 102 and 103 are finished in June, and Job 104 is expected to be finished in July. No raw materials are used indirectly in June. Using this information, answer the following questions. (Assume this company’s predetermined overhead rate did not change across these months).

 

1&2.

Complete the given below table to calculate the cost of the raw materials requisitioned and direct labor cost incurred during June for each of the three jobs? Explanation: 1. The cost of direct materials requisitioned in the month equals the total direct materials costs accumulated on the three jobs less the amount of direct materials cost assigned to Job 102 in May:             Job 102 $ 26,000           Less prior costs   (14,000 ) $ 12,000              Job 103         73,000      Job 104         55,000                Total materials used (requisitioned)       $ 140,000                  2. Direct labor cost incurred in the month equals the total direct labor costs accumulated on the three jobs less the amount of direct labor cost assigned to Job 102 in May:                     Job 102 $ 12,000           Less prior costs   (2,900 ) $ 9,100             Job 103         27,200     Job 104         41,000               Total direct labor       $ 77,300                3. The predetermined overhead rate equals the ratio of the amount of overhead assigned to jobs divided by the amount of direct labor cost assigned to them. Since the same rate is used for all jobs started and completed within a month, the ratio for any one job equals the rate that was applied. This table shows the ratio for jobs 102 and 104:        Job 102   Job 104     Overhead $ 5,160   $ 17,630     Direct labor   12,000     41,000     Ratio   43 %   43 %