Question Details

(Solution Document) hi i cannot figure this out- how are they coming up with the costs of subcontracted work? nor the balance of the work in progress?


hi i cannot figure this out- how are they coming up with the costs of subcontracted work? nor the balance of the work in progress?


Work in Process

 

 

  Costs of subcontracted work

90,000 

  To completed projects

545,500 

  Direct staff costs

199,000 

 

 

  Studio overhead

298,500 

 

 

 

 

      Leeds Architectural Consultants is a service firm, so the names of the accounts it uses are different from the names used in manufacturing companies. Costs of Subcontracted Work is comparable to Direct Materials; Direct Staff Costs is the same as Direct Labor; Studio Overhead is the same as Manufacturing Overhead; and Completed Projects is the same as Finished Goods. Apart from the difference in terms, the accounting methods used by the company are identical to the methods used by manufacturing companies.

 

      Leeds Architectural Consultants uses a job-order costing system and applies studio overhead to Work in Process on the basis of direct staff costs. At the end of January, only one job was still in process. This job (Lexington Gardens Project) had been charged with $13,500 in direct staff costs.

 

Requirement 1:

Compute the predetermined overhead rate that was in use during January. (Omit the "%" sign in your response.)

 

  Predetermined overhead rate

 

Requirement 2:

Complete the following job cost sheet for the partially completed Lexington Gardens Project. (Omit the "$" sign in your response.)

 

Job Cost Sheet?Lexington Gardens Project

As of January 31

  Costs of subcontracted work

$  

  Direct staff costs

$  

  Studio overhead

$  

  Total cost to January 31

$  

 

Explanation:

1:

Because $298,500 of studio overhead was applied to Work in Process on the basis of $199,000 of direct staff costs, the predetermined overhead rate was 150%:

 

Studio overhead applied

=

$298,500

  = 150% rate

Direct staff costs incurred

$199,000

2:

The Lexington Gardens Project is the only job remaining in Work in Process at the end of the month; therefore, the entire $42,000 balance in the Work in Process account at that point must apply to it. Recognizing that the predetermined overhead rate is 150% of direct staff costs, the following computation can be made:

 

 

 

 

  Total cost added to the Lexington Gardens Project

 

$42,000 

  Less: Direct staff costs

$13,500 

 

           Studio overhead cost

 

 

           ($13,500 × 150%)

20,250 

33,750 

  Costs of subcontracted work

 

$8,250 

 

 


Solution details:
STATUS
Answered
QUALITY
Approved
ANSWER RATING

This question was answered on: Dec 08, 2020

PRICE: $15

Solution~000652147485169.zip (25.37 KB)

Buy this answer for only: $15

This attachment is locked

We have a ready expert answer for this paper which you can use for in-depth understanding, research editing or paraphrasing. You can buy it or order for a fresh, original and plagiarism-free solution (Deadline assured. Flexible pricing. TurnItIn Report provided)

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
SiteLock

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

Dec 08, 2020

EXPERT

Tutor

ANSWER RATING

GET INSTANT HELP/h4>

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • As a reference for in-depth understanding of the subject.
  • As a source of ideas / reasoning for your own research (if properly referenced)
  • For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

NEW ASSIGNMENT HELP?

Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN A DEADLINE.

Order Now