Use the Following Information for the Next 2 Questions

question 96

Multiple Choice

Use the following information for the next 2 questions. Sparkle Company uses job costing and applies overhead using an actual costing system using direct labor hours as the allocation base. This period's estimated overhead cost is $400,000, estimated direct labor cost is $500,000 and estimated direct labor hours are 25,000. This period actual overhead cost was $420,000, actual direct labor cost was $390,000, and actual direct labor hours were 20,000.
-What is the total manufacturing cost of Job 402?

• A) $1,100
• B) $1,772
• C) $1,320
• D) $1,640

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Definitions:

Long-Term Asset

A long-term asset is an asset that is not expected to be converted into cash within a year and is used over a long period, such as property, plant, and equipment.

Intangible Asset

An asset that lacks physical substance and usually is very hard to evaluate, such as patents, trademarks, and copyrights.

Lease Term

The period for which a lease agreement is effective, specifying the duration for which the lessee has the right to use the property.