Altina Company just finished job A40. It included $400 of direct materials, and $3 600 of direct labour. Altina uses a predetermined manufacturing overhead rate based on a percentage of direct labour costs. That rate is 40%. The entry to record the completion of the job should be a:

Question

Quizplus · Accepted Answer

The cost of the job includes direct materials ($400), direct labor ($3,600), and manufacturing overhead (40% of $3,600 = $1,440). The total cost is $5,440. Upon completion, the cost is transferred from Work in Process to Finished Goods, so the entry is a debit to Finished Goods and a credit to Work in Process for $5,440.

Altina Company Just Finished Job A40