Diamond Design Company makes custom chairs for individual customers.On September 1, there was one job in process, Job 243, with a cost of $2,000.Jobs 244, 245, and 246 were started during the month of September.Data on costs added during the month are as follows:
Overhead is applied to production at the rate of 60% of direct labor cost.Job 245 was completed on September 14 and the client was billed at cost plus 40%.All other jobs remained in process.

Calculate the balance in Work-in-Process on September 30.
A) $17,717
B) $22,875
C) $30,512
D) $32,820
E) $15,820

Question

Diamond Design Company makes custom chairs for individual customers.On September 1, there was one job in process, Job 243, with a cost of $2,000.Jobs 244, 245, and 246 were started during the month of September.Data on costs added during the month are as follows:  
 Overhead is applied to production at the rate of 60% of direct labor cost.Job 245 was completed on September 14 and the client was billed at cost plus 40%.All other jobs remained in process.
 
Calculate the balance in Work-in-Process on September 30.
A) $17,717 
B) $22,875 
C) $30,512 
D) $32,820 
E) $15,820

Quizplus · Accepted Answer

11ea8a4c_48f5_627a_a0e6_2953e64d5c8f_TB5550_00 Overhead^* = 60% of direct labor cost Overhead for Job 243 = 60% × $2,240 = $1,344 Overhead for Job 244 = 60% × $1,000 = $600 Overhead for Job 246 = 60% × $2,530 = $1,518

Diamond Design Company Makes Custom Chairs for Individual Customers