Principles of Accounting, Chapter 19: Job Costing and Modern Cost Management Systems:http://www.principlesofaccounting.com/chapter-19/Principles of Accounting, Chapter 20: Process Costing and Activity
Alaska Launch, a private-sector aerospace company, provided the following aggregated data for satellite construction jobs during a recent period:
| Direct materials | $13,442,769 |
| Direct labor | 21,889,554 |
| Applied (and actual) factory overhead | 8,223,454 |
| Beginning work in process | 14,550,098 |
| Ending work in process | 17,559,000 |
Satellites are usually constructed to specific customer specifications, and the contract selling price is 125% of cost.
Assuming that the above costs are attributable to several different satellites in various stages of production, how would the cost of direct materials, direct labor, and overhead be tracked to specific jobs? How important is the job costing system in establishing a fair selling price for each satellite?
