Job Order Cost System

question 27

Essay

Job order cost system
Century Pools designs and builds custom pools and spas to the customer's order and uses a job order system.The predetermined overhead rate for the current year is 60% of direct labor cost.
At the end of the current year,Century Pools' direct labor cost totaled $170,000 and actual overhead amounted to $105,000.
A pool built for F.Becker required $32,000 of direct materials and $6,500 of direct labor.It was completed in May of the current year.
(a)Compute the total cost of the Becker pool as shown on the job cost sheet at date of completion.
(b)Compute the amount of under- or over-applied manufacturing overhead for Century's operations for the current year.
(c)What disposition is made of over- or under-applied overhead at the end of the year (assume that the amount is not material)?

---

Definitions:

US Dollars

The official currency of the United States, widely used as a standard of exchange internationally.

US Demand

The total quantity of goods and services that consumers in the United States are willing and able to purchase at a given price level and time.

British Pounds

The official currency of the United Kingdom, symbolized as £.

Appreciation

An increase in the value of an asset over time.