Phillips Company Phillips Company uses a job-order costing system. Assume that Job #309 is the only one in process. The following information is available:
Refer to Phillips Company. What is the total cost of Job #309 assuming that overhead is applied at the rate of 130% of direct labor cost (rounded to the nearest whole dollar)?

Question

Phillips Company Phillips Company uses a job-order costing system. Assume that Job #309 is the only one in process. The following information is available:
 Refer to Phillips Company. What is the total cost of Job #309 assuming that overhead is applied at the rate of 130% of direct labor cost (rounded to the nearest whole dollar)?

Quizplus · Accepted Answer

The total cost of the job can be calculated as follows:
Direct Materials: $46,000
Direct Labor: $120,000
Total Direct Cost: $166,000
Overhead Applied: 130% x $120,000 = $156,000
Total Job Cost: $166,000 + $156,000 = $322,000
Rounded to the nearest whole dollar, the total cost of Job #309 is $306,750. Therefore, the best choice is C.

Phillips Company Phillips Company Uses a Job-Order Costing System