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QUESTION

Sigma Company applies overhead cost to jobs on the basis of direct labor cost.

Sigma Company applies overhead cost to jobs on the basis of direct labor cost. Job A, which was started and completed during the current period, shows charges of $5000 for overhead on its job cost sheet. Job direct materials, $8000 for direct labor, and $6000 for overhead on its job cost sheet. Job B, which is still in process at year-end, shows charges of $2500 for direct materials and $4000 for direct labor. Should any overhead cost be added to Job B at year-end? Explain and show the amount

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