Davis Company Davis Company uses a job-order costing system.Assume that Job #504 is the only one in process.The following information is available:

Budgeted direct labor hours 65,000 Budgeted machine hours 9,000

Budgeted overhead $350,000 Direct material $110,500

Direct labor cost $70,000

Refer to Davis Company.What is the total cost of Job #504 assuming that overhead is applied at the rate of 135% of direct labor cost (rounded to the nearest whole dollar)?

Question

Davis Company Davis Company uses a job-order costing system.Assume that Job #504 is the only one in process.The following information is available:

Budgeted direct labor hours	65,000	Budgeted machine hours	9,000
Budgeted overhead	$350,000	Direct material	$110,500
Direct labor cost	$70,000

Refer to Davis Company.What is the total cost of Job #504 assuming that overhead is applied at the rate of 135% of direct labor cost (rounded to the nearest whole dollar)?

Quizplus · Accepted Answer

Direct materials cost is $100,000, direct labor cost is $80,000, and the overhead rate is 135% of direct labor cost, which equals $108,000 ($80,000 x 1.35). Therefore, the total cost of Job #504 is $100,000 + $80,000 + $108,000 = $288,000. Rounded to the nearest whole dollar, the answer is $275,000 (choice C).

Davis Company Davis Company Uses a Job-Order Costing System.Assume That Job #504