Parker Corporation Has a Job-Order Costing System and Uses a Predetermined

question 61

Multiple Choice

Parker Corporation has a job-order costing system and uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. At the beginning of the year, manufacturing overhead and direct labor-hours for the year were estimated at $50,000 and 20,000 hours, respectively. In June, Job #461 was completed. Materials costs on the job totaled $4,000 and labor costs totaled $1,500 at $5 per hour. At the end of the year it was determined that the company worked 24,000 direct labor-hours for the year and incurred $54,000 in actual manufacturing overhead costs.If Job #461 contained 100 units, the unit product cost on the completed job cost sheet would be:

• A) $61.75
• B) $62.50
• C) $63.10
• D) $55.00

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Definitions:

Physically

Relating to the body or material things, often concerning presence or actions in the physical world.

Scientific Management

A management theory developed by F.W. Taylor, emphasizing efficiency and productivity by systematically studying work processes and establishing standards.

Vertical Loading

Vertical Loading is a job design technique that involves adding more responsibilities and decision-making authority to an employee's role.

Overspecialized Work

Work that is highly focused or narrow in scope, potentially limiting a person’s skills and adaptability to other professional areas.