Apply Overhead to a Job
Winston Company applies overhead cost to jobs on the basis of direct labor cost. Job X, which was started and completed during the current period, shows charges of $18,000 for direct materi- als, $10,000 for direct labor, and $15,000 for overhead on its job cost sheet. Job Q, which is still in process at year-end, shows charges of $20,000 for direct materials, and $8,000 for direct labor.
Should any overhead cost be added to Job Q at year-end? If so, how much? Explain.
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