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Sigma corporation applies overhead cost to jobs on the basis of direct labor cost. job v, which was started and completed during the current period, shows charges of $5,000 for direct materials, $8,000 for direct labor, and $6,000 for overhead on its job cost sheet. job w, which is still in process at year-end, shows charges of $2,500 for direct materials and $4,000 for direct labor.

Respuesta :

 Job V had $8,000 of direct labor, and $6,000 of overhead was applied to the job. $6,000 divided by $8,000 = .75 overhead rate. In other words, the application was based on taking $8,000 of DL x .75 rate = $6,000 overhead. 

For Job W, take $4,000 DL x same .75 rate = $3,000 

The OH cost to be applied to W at year-end is $3,000.
anthougo

The overhead applied to Job W is $3,000.

What is overhead application?

Overhead application is the systematic assignment of factory overhead costs to the production units. The assignment is based on either a standard overhead rate (usually predetermined), or it is computed specific to each reporting period.

Data and Calculations:

Job Sheets:

                                Job V     Job W

Direct materials     $5,000    $2,500

Direct labor              8,000      4,000

Applied overhead   6,000      ?

Overhead application basis = direct labor cost

Overhead application rate = 75% ($6,000/$8,000 x 100)

Question Completion:

How overhead cost is applied to Job W?

Thus, the overhead applied to Job W is $3,000 ($4,000 x 75%).

Learn more about overhead application rate at https://brainly.com/question/24516871

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