Edward Nabors owns Enclose, which designs and manufactures perimeter fencing for large retail and commercial buildings. Each job goes through three stages: design, production, and installation. Three jobs were started and completed during the first week of May 2010. No jobs were in process at the end of April 2010. Information for the three departments for the first week in May follows. Overhead is applied using departmental rates. Design and Installation use direct labor cost as the base, with rates of 30 and 90 percent, respectively. Production uses machine hours as the base, with a rate of $15 per hour. Actual overhead for the month was $105,600 in Design, $60,000 in Production, and $31,200 in Installation. a. Determine the overhead to be applied to each job. By how much is the overhead underapplied or overapplied in each department? For the company? b. Assume that no journal entries have been made to Work in Process Inventory. Journalize all necessary entries to both the subsidiary ledger and general ledger accounts. Accrue direct labor costs. c. Calculate the total cost for eachjob.
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