Job 599 Was Recently Completed

question 95

Essay

Job 599 was recently completed.The following data have been recorded on its job cost sheet:
The company applies manufacturing overhead on the basis of direct labor-hours.The predetermined overhead rate is $20 per direct labor-hour.Required:
Compute the unit product cost that would appear on the job cost sheet for this job. $$\begin{array} { | l | r | } \hline \text { Direct materials } & \$ 40,610 \\\hline \text { Direct labor-hours } & 1,147 \mathrm { DLHs } \\\hline \text { Direct labor wage rate } & \$ 11 \text { per } \mathrm { DLH } \\\hline \text { Number of units completed } & 3,100 \text { units } \\\hline\end{array}$$

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Definitions:

ACP (Average Collection Period)

The average number of days it takes for a business to receive payments owed by its clients, reflecting the effectiveness of a company's credit and collection policies.

Credit Terms

The conditions, including payment deadlines and interest rates, that a seller extends to a buyer.

Trade Credit

Short-term financing provided by suppliers, allowing buyers to purchase goods or services on account without immediate cash payment.

Compensating Balances

A requirement by some banks for companies to maintain a minimum balance in their account as part of a loan agreement, effectively reducing the amount of usable cash.