Rally Point Inc.Rally Point Inc. designs and builds volleyball gymnasiums. Each gymnasium is custom-built to an individual customer's specifications. The company uses job-order costing to track its costs. In January, the company worked on three jobs. Data for these jobs are as follows: $\begin{array}{lrrrr}&\text { Job } 100&\text { Job } 200&\text { Job } 300\
\text { Balance 1/1 } & \$ 13,790 & \$ 0 & \$0 \
\text { Direct Materials } & 16,200 & 8,500 & 30,500 \
\text { Direct Labour Cost } & 23,300 & 7,600 & 45,000 \
\text { Machine Hours } & 400 & 300 & 2,000
\end{array}$ Overhead is applied to jobs at the rate of $25 per machine hour. By January 31, Job 200 is the only job unfinished. The balance of Finished Goods Inventory on January 1 is $63,290 (consisting of Job 100 only). Jobs 100 and 300 are sold during January. The company sells its product at cost plus 40%.
-Refer to Rally Point, Inc. What is the Cost of Goods Sold for January?

Question

Rally Point Inc.Rally Point Inc. designs and builds volleyball gymnasiums. Each gymnasium is custom-built to an individual customer's specifications. The company uses job-order costing to track its costs. In January, the company worked on three jobs. Data for these jobs are as follows: $\begin{array}{lrrrr}&\text { Job } 100&\text { Job } 200&\text { Job } 300\
\text { Balance 1/1 } & \$ 13,790 & \$  0 & \$0 \
\text { Direct Materials } & 16,200 & 8,500 & 30,500 \
\text { Direct Labour Cost } & 23,300 & 7,600 & 45,000 \
\text { Machine Hours } & 400 & 300 & 2,000
\end{array}$ Overhead is applied to jobs at the rate of $25 per machine hour. By January 31, Job 200 is the only job unfinished. The balance of Finished Goods Inventory on January 1 is $63,290 (consisting of Job 100 only). Jobs 100 and 300 are sold during January. The company sells its product at cost plus 40%.
-Refer to Rally Point, Inc. What is the Cost of Goods Sold for January?

Quizplus · Accepted Answer

The Cost of Goods Sold (COGS) includes the costs of Jobs 100 and 300, which were completed and sold. Calculate COGS as follows:  - Job 100: $13,790 (beginning balance) + $16,200 (direct materials) + $23,300 (direct labor) + $10,000 (overhead: 400 machine hours * $25) = $63,290  - Job 300: $0 (beginning balance) + $30,500 (direct materials) + $45,000 (direct labor) + $50,000 (overhead: 2,000 machine hours * $25) = $125,500  Total COGS = $63,290 + $125,500 = $188,790

Rally Point Inc Overhead Is Applied to Jobs at the Rate of $25