Managerial Accounting

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Job Order Costing: Solve for Labor in Ending Work in Process


Your client uses a job-order costing system. They have one job unfinished in ending Work in Process. They apply manufacturing overhead based on direct material cost. The activity in the Work in Process Account shows:

Costs in the Work in Process Inventory Account:
Beginning balance \$30,000
Direct material used \$80,000
Direct labor incurred \$75,000
Applied manufacturing overhead \$60,000
Cost of goods manufactured \$225,000

The job in ending Work in Process has \$7,500 of overhead applied to it. What is the direct labor charged to this job in ending Work in Process?