The Omega Company manufactures customized motors on a job-order basis. Job 492 is an order for 100 units. It requires the following: $$\begin{array} { l c }
\text { direct materials } & \$ 3,000 \
\text { direct labor } ( \$ 10 / h r ) & 1,000 \
\text { overhead } ( 150 \% \text { DL } \$ ) & 1,500
\end{array}$$
After inspection, 2 units required rework which required 8 additional direct labor hours and $60 of materials.
If the rework is considered abnormal spoilage, what is the cost of job 492?
A)$5,500
B)$5,760
C)$3,140
D)$5,640

Question

The Omega Company manufactures customized motors on a job-order basis. Job 492 is an order for 100 units. It requires the following: $$\begin{array} { l c } 
\text { direct materials } & \$ 3,000 \
\text { direct labor } ( \$ 10 / h r ) & 1,000 \
\text { overhead } ( 150 \% \text { DL } \$ ) & 1,500
\end{array}$$
After inspection, 2 units required rework which required 8 additional direct labor hours and $60 of materials.
If the rework is considered abnormal spoilage, what is the cost of job 492?
A)$5,500
B)$5,760
C)$3,140
D)$5,640

Quizplus · Accepted Answer

The cost of job 492 is $5,760. The direct materials cost is $3,000, the direct labor cost is $1,000, and the overhead cost is $1,500. The rework cost is $60 for materials and $80 for labor. The total cost of the job is $5,760.

The Omega Company Manufactures Customized Motors on a Job-Order Basis