Spang Corporation Uses a Job-Order Costing System with a Single

question 21

Multiple Choice

Spang Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on the following data:
Recently, Job P505 was completed with the following characteristics:

-The total job cost for Job P505 is closest to:

• A) $9,400
• B) $9,940
• C) $7,740
• D) $2,740

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Definitions:

Blending Department

A division within a manufacturing operation where raw materials are combined to produce a homogeneous product.

Weighted-Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory based on the average cost of all units available for sale.

Conversion Cost

Direct labor cost plus manufacturing overhead cost.

Fitting Department

A specific section within a manufacturing facility where products are assembled, fitted, or finished according to specifications.