A job has direct costs of $520,000 and allocated overhead of $78,000. What total job cost is shown?
Correct Answer
A) $598,000
Total job cost includes direct costs plus allocated overhead.
Why This Is the Correct Answer
Total job cost includes direct costs plus allocated overhead.
Why the Other Options Are Wrong
Option B: $572,000
$572,000 is below the supported result for total job cost; it likely uses the wrong base, period, or account bucket.
Option C: $608,000
$608,000 is above the supported result for total job cost; it likely adds an unsupported amount or compares the wrong financial base.
Option D: $676,000
$676,000 is above the supported result for total job cost; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Includes and costs live in different drawers; Accountant Checks tells which opens.
Reference Hint
Open-book path: tab Builder's Guide to Accounting, 2001 to Section Two, Accounting for Costs and Expenses, Accounting for Overhead; use the job ledger figures in the stem and recompute the same accounting measure.
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