Job 31 has a direct materials cost of $300 and a total manufacturing cost of $900. Overhead is applied to jobs at a rate of 200 percent of direct labor cost.
Use the relationships among total manufacturing costs, conversion cost, and prime cost to determine the following costs for job 31:
1. Conversion Cost?
2. Direct Labor Cost?
3. Manufacturing overhead cost?
4. Prime cost?
200
Conversion:
To determine the costs for job 31, we can use the relationships among total manufacturing costs, conversion cost, and prime cost:
1. Conversion Cost:
Conversion Cost refers to the cost of converting raw materials into finished goods. It includes direct labor cost and manufacturing overhead cost.
Conversion Cost = Total Manufacturing Cost - Direct Materials Cost
Conversion Cost = $900 - $300
Conversion Cost = $600
2. Direct Labor Cost:
Direct Labor Cost refers to the cost of labor directly involved in the production of goods or services. In this case, it is not directly given. However, we can calculate it using the overhead rate.
Direct Labor Cost = (Overhead rate / 200% ) * Direct Materials Cost
Direct Labor Cost = (200% / 200%) * $300
Direct Labor Cost = $300
3. Manufacturing Overhead Cost:
Manufacturing Overhead Cost is applied to jobs at a rate of 200% of the Direct Labor Cost.
Manufacturing Overhead Cost = Overhead Rate * Direct Labor Cost
Manufacturing Overhead Cost = 200% * $300
Manufacturing Overhead Cost = $600
4. Prime Cost:
Prime Cost refers to the total cost of direct materials and direct labor. It does not include manufacturing overhead cost.
Prime Cost = Direct Materials Cost + Direct Labor Cost
Prime Cost = $300 + $300
Prime Cost = $600
Therefore, for job 31:
1. Conversion Cost = $600
2. Direct Labor Cost = $300
3. Manufacturing Overhead Cost = $600
4. Prime Cost = $600
To determine the costs for job 31, let's break down the given information and use the relationships among total manufacturing costs, conversion cost, and prime cost.
1. Conversion Cost:
Conversion costs refer to the expenses incurred during the production process, including direct labor and manufacturing overhead. The formula to calculate conversion cost is:
Conversion Cost = Total Manufacturing Cost - Direct Materials Cost
Given that the Total Manufacturing Cost for job 31 is $900 and the Direct Materials Cost is $300:
Conversion Cost = $900 - $300 = $600
Therefore, the Conversion Cost for job 31 is $600.
2. Direct Labor Cost:
Direct labor cost is the sum of wages or salaries paid to employees who work directly on the production of a product. To calculate direct labor cost, we need to know the direct labor rate or the number of direct labor hours worked.
However, the direct labor cost is not directly provided in the given information. If we have either the direct labor rate or the number of direct labor hours worked, we can calculate the direct labor cost by multiplying the rate or hours by the direct labor rate.
3. Manufacturing Overhead Cost:
Manufacturing overhead costs refer to indirect costs incurred during the production process, such as rent, utilities, and depreciation. The formula to calculate manufacturing overhead cost is:
Manufacturing Overhead Cost = Overhead Applied - Direct Labor Cost
In the given information, it's stated that overhead is applied to jobs at a rate of 200 percent of direct labor cost. Without knowing the direct labor cost, we can't calculate the manufacturing overhead cost.
4. Prime Cost:
Prime cost includes the direct materials cost and the direct labor cost. The formula to calculate prime cost is:
Prime Cost = Direct Materials Cost + Direct Labor Cost
Again, without knowing the direct labor cost, we can't calculate the prime cost.
Therefore, based on the given information, we can only determine the Conversion Cost for job 31, which is $600. The Direct Labor Cost, Manufacturing Overhead Cost, and Prime Cost cannot be determined without additional information.