Concept explainers
Determine over-and underbillings for a company with the following information:
Job Number: 311
Job Name: Smith Remodel
Current Contract Amount: $22,530
Total Estimated Cost at Completion: $17,264
Actual Costs to Date: $16,538
Total Billed: $21,000
Job Number: 316
Job Name: Redd Remodel
Current Contract Amount: $35,624
Total Estimated Cost at Completion: $28,221
Actual Costs to Date: $22,345
Total Billed: $28,500
Job Number: 318
Job Name Winter Remodel
Current Contract Amount $17,954
Total Estimated Cost a: Completion. $14,567
Actual Costs to Date: $4,562
Total Billed: $6,000
Job Number: 322
Job Name Richardson Remodel
Current Contract Amount $3,213
Total Estimated Cost at Completion: $3,721
Actual Costs to Date: $1,956
Total Billed: $0
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Chapter 4 Solutions
Construction Accounting And Financial Management (4th Edition)
- CS Company started work on three job sites during the current year. Any costs incurred are expected to be recoverable. Data relating to the three jobs are given below: Billings on Contract Site Contract Cost Estimated Costs to Complete Collections on Price Incurred 3,750,000 1,000,000 Billings 5,000,000 900,000 1,000,000 1 5,000,000 5,000,000 900,000 2 7.000,000 2.500.000 4,000,000 3 1.000,000 1,000,000 1.500,000 1. If the company recoeds revenue over time, how much must be shown as current asset in the balance sheet of MOC Construction Company as of December 31? A. 5,500,000 B. S00,000 C 250,000 D. 100,000 2. If the company records revenue at a point in time, how much must be shown as current asset in the balance sheet of MOC Construction Company as of December 317 A. 5,100,000 8. S00,000 C 250,000 D. 100,000arrow_forwardCS Company started work on three job sites during the current year. Any costs incurred are expected to be recoverable. Data relating to the three jobs are given below: Site Contract Cost Estimated Costs Billings on Collections on Price Incurred to Complete Contract Billings 5,000,000 1 5,000,000 3,750,000 5,000,000 2 7,000,000 1,000,000 4,000,000 1,000,000 900,000 1,500,000 900,000 1,000,000 3 2,500,000 1,000,000 If the company records revenue at a point in time, how much must be shown as current asset in the balance sheet of MOC Construction Company as of December 31? A. 5,100,000 B. 500,000 C. 250,000 D. 100,000arrow_forwardThe costs incurred for Job A are:Total labor and overhead $37,225Total other direct costs $10,775The bid price for the job if the company made a 40 percent profit on the bid price is:arrow_forward
- Event Forms expects $120,000 in overhead during the next year. It doesn't know whether it should apply overhead on the basis of its anticipated direct labor hours of 6,000 or its expected machine hours of 5,000. What would be the product cost under each predetermined allocation rate if the last job incurred $3,500 in direct material cost, 55 direct labor hours, and 55 machine hours? Wages are paid at $17 per hour.arrow_forwardPocono Cement Forms expects $900,000 in overhead during the next year. It does not know whether it should apply overhead on the basis of its anticipated direct labor hours of 60,000 or its expected machine hours of 30,000. Determine the product cost under each predetermined allocation rate if the last job incurred $1,550 in direct material cost, 90 direct labor hours, and 75 machine hours. Wages are paid at $16 per hour.arrow_forwardWhen setting its predetermined overhead application rate. Tasty Turtle estimated its overhead would be $75,000 and manufacturing would require 25,000 machine hours in the next year. At the end of the year, it found that actual overhead was $74,000 and manufacturing required 24,000 machine hours. Determine the predetermined overhead rate. What is the overhead applied during the year? Prepare the journal entry to eliminate the under- or over applied overhead.arrow_forward
- When setting its predetermined overhead application race, Tasty Box Meals estimated its overhead would be $100,000 and would require 25,000 machine hours in the next year. At the end of the year. It found that actual overhead was $102,000 and required 26,000 machine hours. Determine the predetermined overhead rate. What is the overhead applied during the year? Prepare the journal entry to eliminate the under applied or over applied overhead.arrow_forwardHicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. Lumber used to construct decks ($12.00 per square foot) Carpenter labor used to construct decks ($10 per hour) Construction supervisor salary ($45,000 per year) Depreciation on tools and equipment ($6,000 per year) Selling and administrative expenses ($35,000 per year) Rent on corporate office space ($34,000 per year) Nails, glue, and other materials required to construct deck (varies per job)arrow_forwardYork Company Is a machine shop that estimated overhead will be $50,000, consisting of 5,000 hours of direct labor. The cost to make job 0325 is $70 in aluminum and two hours of labor at $20 per hour. During the month. York incurs $50 in indirect material cost. $150 in administrative labor, $300 in utilities, and $250 in depreciation expense. What is the predetermined overhead rate if direct labor hours are considered the cost driver? What is the cost of Job 0325? What is the overhead incurred during the month?arrow_forward
- Rulers Company is a neon sign company that estimated overhead will be $60,000, consisting of 1,500 machine hours. The cost to make Job 416 is $95 in neon, 15 hours of labor at $13 per hour, and five machine hours. During the month, it incurs $95 in indirect material cost, $130 in administrative labor, $320 in utilities, and $350 in depreciation expense. What is the predetermined overhead rate if machine hours are considered the cost driver? What is the cost of Job 416? What is the overhead incurred during the month?arrow_forwardCompute the total job cost for each of the following scenarios: a. If the direct labor cost method is used in applying factory overhead and the predetermined rate is 100%, what amount should be charged to Job 2010 for factory overhead? Assume that direct materials used totaled 5,000 and that the direct labor cost totaled 3,200. b. If the direct labor hour method is used in applying factory overhead and the predetermined rate is 10 an hour, what amount should be charged to Job 2010 for factory overhead? Assume that the direct materials used totaled 5,000, the direct labor cost totaled 3,200, and the number of direct labor hours totaled 250. c. If the machine hour method is used in applying factory overhead and the predetermined rate is 12.50 an hour, what amount should be charged to Job 2010 for factory overhead? Assume that the direct materials used totaled 5,000, the direct labor cost totaled 3,200, the direct labor hours were 250 hours, and the machine hours were 295 hours.arrow_forwardJob Cost Example Job WR53 at NW Fab, Inc. required $200 of direct materials and 10 direct labor hours at $15 per hour. Estimated total overhead for the year was $760,000 and estimated direct labor hours were 20,000. What would be recorded as the cost of job WR53?arrow_forward
- Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax CollegePrinciples of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning