Reference no: EM13495335

XYZ Company began operations during 2011 and employs a job-order costing system that applies overhead to jobs using direct labor hours as the activity level. For 2011, XYZ Company had total estimated overhead of $229,500 and total estimated direct labor hours of 25,500. Listed below is a summary of events and transactions that occurred during 2011: 

a. XYZ Company purchased 80,000 pounds of direct materials at $4.20 per pound. 

b. XYZ began work on three jobs. Direct materials used for each job were: 

Job A-1 .................. 17,000 pounds 

Job A-2 .................. 25,000 pounds 

Job A-3 .................. 30,000 pounds 

c. Direct labor hours used for each job were: 

Job A-1 .................. 9,800 hours 

Job A-2 .................. 7,800 hours 

Job A-3 .................. 8,400 hours 

Direct labor workers are paid $12 per hour. 

d. The following additional costs were incurred: 

Manufacturing Facility Administrative Facility 

Rent ……………... $ 42,000 $ 15,000 

Depreciation ……. 55,000 12,000 

Utilities …………. 51,000 10,000 

Salaries ………..… 92,0001 65,000 

Totals …………... $ 240,000 $ 102,000 

1 This $92,000 is all indirect labor. See letter (c) for direct labor for the manufacturing facility. 

e. Jobs A-1 and A-2 were completed during 2011. Job A-2 was sold to the customer for $420,000. 

Calculate the amount of net income reported on XYZ Company''s 2011 income statement. Do not use decimals in your answer.