Chattanooga Tire manufactures tires for all-terrain vehicles. Chattanooga uses job costing and has a perpetual inventory system.
On June 22, Chattanooga received an order for 110 TX tires from ATV Corporation at a price of $90 each. The job, assigned number 298, was promised for July 10. After purchasing the materials, Chattanooga began production on June 30 and incurred the following direct labor and direct materials costs in completing the order:
Chattanooga allocates manufacturing overhead to jobs on the basis of the relation between expected overhead costs ($490,000) and expected direct labor hours (17,500). Job 298 was completed on July 3 and shipped to ATV on July 5.
1. Prepare a job cost record for Job 298.
2. Calculate the total profit and the per-unit profit for Job 298.