Valley Water Slides makes custom water slides for hotels. On September 1, three jobs were in process: Jobs 812, 813, and 814. Two more jobs, Jobs 815 and 816, were started during September. By September 30, Jobs 812, 814, and 816 were finished. The following data were collected:
Overhead is applied at the rate of 120% of direct labour cost. Jobs are sold at cost plus 60%. Selling and administrative expenses for September totalled $2,950. By September 30, Jobs 812 were 816 are sold, but the customer who ordered Job 814 cancelled the order so the slide is still in the warehouse. $\begin{array}{lrrrrr}
& \text { Job 812 } & \text { Job 813 } & \text { Job 814 } & \text { Job 815 } & \text { Job 816 } \
9 / 1 \mathrm{Bal} \text { ance } & \$ 615 & \$ 830 & \$ 945 & \ldots & \ldots\
\text { Direct Materials } & 750 & 235 & 1,280 & \$ 200 & \$ 915 \
\text { Direct Labour } & 420 & 115 & 560 & 320 & 875
\end{array}$
-Refer to the Figure.What is the cost of goods sold for September?

Question

Valley Water Slides makes custom water slides for hotels. On September 1, three jobs were in process: Jobs 812, 813, and 814. Two more jobs, Jobs 815 and 816, were started during September. By September 30, Jobs 812, 814, and 816 were finished. The following data were collected:
Overhead is applied at the rate of 120% of direct labour cost. Jobs are sold at cost plus 60%. Selling and administrative expenses for September totalled $2,950. By September 30, Jobs 812 were 816 are sold, but the customer who ordered Job 814 cancelled the order so the slide is still in the warehouse. $\begin{array}{lrrrrr} 
& \text { Job 812 } & \text { Job 813 } & \text { Job 814 } & \text { Job 815 } & \text { Job 816 } \
9 / 1 \mathrm{Bal} \text { ance } & \$ 615 & \$ 830 & \$ 945 & \ldots & \ldots\
\text { Direct Materials } & 750 & 235 & 1,280 & \$ 200 & \$ 915 \
\text { Direct Labour } & 420 & 115 & 560 & 320 & 875
\end{array}$
-Refer to the Figure.What is the cost of goods sold for September?

Quizplus · Accepted Answer

To calculate the cost of goods sold (COGS) for September, we need to consider the jobs that were finished and sold during the month. Jobs 812 and 816 were finished and sold. The cost of each job is calculated by adding the beginning balance, direct materials, direct labor, and applied overhead (120% of direct labor).- Job 812:  - Beginning Balance: $615  - Direct Materials: $750  - Direct Labor: $420  - Overhead: 120% of $420 = $504  - Total Cost: $615 + $750 + $420 + $504 = $2,289- Job 816:  - Beginning Balance: $0 (not provided, assuming job started and finished in September)  - Direct Materials: $915  - Direct Labor: $875  - Overhead: 120% of $875 = $1,050  - Total Cost: $0 + $915 + $875 + $1,050 = $2,840Adding the total costs of Jobs 812 and 816 gives the COGS for September:- COGS = $2,289 + $2,840 = $5,129

Valley Water Slides Makes Custom Water Slides for Hotels -Refer to the Figure