Bates Manufacturing Uses a Job-Order Costing System,and Overhead Is Applied

question 109

Multiple Choice

Bates Manufacturing uses a job-order costing system,and overhead is applied on the basis of direct labor hours.At the beginning of the period,the company estimated that overhead would be $64,000 and 10,000 direct labor hours would be worked.Two projects were started and completed in the current accounting period.The following transactions were completed during the period: (a) Used $10,000 of direct material on Project I and $6,800 of direct material on Project II.
(b) Labor costs for the two jobs amounted to the following: Project I,$24,000 (2,000 hours) ; Project II,$44,000 (6,000 hours) .
(c) Project II was sold during the period for $120,000.
The company's gross margin for the period was: (Do not round intermediate calculation.)

• A) $30,800.
• B) $18,000.
• C) $89,200.
• D) $69,200.

---

Definitions:

Implementation Stage

The phase in a project or plan where strategies and ideas are put into action.

Rapid Prototyping

A group of techniques used to quickly fabricate a scale model of a physical part or assembly using three-dimensional computer-aided design (CAD) data.

Detailed Experiments

Rigorous testing and validation processes used to explore hypotheses, assess outcomes, and refine strategies or products based on empirical data.

Implementation Phase

The stage in a project or strategic plan where strategies and plans are put into action to achieve the desired outcomes.