D is corrent. The requirement is to determine the cost of jobs completed in January 2013. In a job order costing system, manufacturing overhead cannot be traced to specific jobs. Instead, overhead is accumulated in an overhead control account and applied to work performed based on some predetermined overhead rate. The difference between actual and applied overhead is normally either allocated to work in process, finished goods, and cost of goods sold or written off to cost of goods sold. In this case the cost of jobs completed is being determined for January only. Under- or overapplied overhead is not usually considered on a monthly basis. Therefore, the cost of jobs completed should include allocated overhead only. The amount of indirect materials issued to production has already been included in overhead applied. These costs do not need to be considered again in determining the cost of jobs completed. The cost of jobs completed can be computed as follows:
A is incorrect. The requirement is to determine the cost of jobs completed in January 2013. In a job order costing system, manufacturing overhead cannot be traced to specific jobs. Instead, overhead is accumulated in an overhead control account and applied to work performed based on some predetermined overhead rate. The difference between actual and applied overhead is normally either allocated to work in process, finished goods, and cost of goods sold or written off to cost of goods sold. In this case the cost of jobs completed is being determined for January only. Under- or overapplied overhead is not usually considered on a monthly basis. Therefore, the cost of jobs completed should include allocated overhead only. The amount of indirect materials issued to production has already been included in overhead applied. These costs do not need to be considered again in determining the cost of jobs completed. The cost of jobs completed can be computed as follows:
A is incorrect. The requirement is to determine the cost of jobs completed in January 2013. In a job order costing system, manufacturing overhead cannot be traced to specific jobs. Instead, overhead is accumulated in an overhead control account and applied to work performed based on some predetermined overhead rate. The difference between actual and applied overhead is normally either allocated to work in process, finished goods, and cost of goods sold or written off to cost of goods sold. In this case the cost of jobs completed is being determined for January only. Under- or overapplied overhead is not usually considered on a monthly basis. Therefore, the cost of jobs completed should include allocated overhead only. The amount of indirect materials issued to production has already been included in overhead applied. These costs do not need to be considered again in determining the cost of jobs completed. The cost of jobs completed can be computed as follows:
C is incorrect. The requirement is to determine the cost of jobs completed in January 2013. In a job order costing system, manufacturing overhead cannot be traced to specific jobs. Instead, overhead is accumulated in an overhead control account and applied to work performed based on some predetermined overhead rate. The difference between actual and applied overhead is normally either allocated to work in process, finished goods, and cost of goods sold or written off to cost of goods sold. In this case the cost of jobs completed is being determined for January only. Under- or overapplied overhead is not usually considered on a monthly basis. Therefore, the cost of jobs completed should include allocated overhead only. The amount of indirect materials issued to production has already been included in overhead applied. These costs do not need to be considered again in determining the cost of jobs completed. The cost of jobs completed can be computed as follows:
