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E2-12 Don Lieberman and Associates

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E2-12 Don Lieberman and Associates, a CPA firm, uses job order costing to capture the
costs of its audit jobs. There were no audit jobs in process at the beginning of November.
Listed below are data concerning the three audit jobs conducted during November.

   Lynn   Brian   Mike 
Direct materials  600  400  200
Auditor labor costs  5,400  6,600  3,375
Auditor hours  72  88  45

Overhead costs are applied to jobs on the basis of auditor hours, and the predetermined
overhead rate is $50 per auditor hour. The Lynn job is the only incomplete job at the end
of November. Actual overhead for the month was $11,000.

(a) Determine the cost of each job.
(b) Indicate the balance of the Service Contracts in Process account at the end of November.
(c) Calculate the ending balance of the Operating Overhead account for November.

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