Roger Parker, the production manager of Products Company, entered the office of controller Harris Johnson...
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Accounting
Roger Parker, the production manager of Products Company, entered the office of controller Harris Johnson and asked, Harris what gives here? I was charged for direct labor hours on Job AD and my records show that we spent only hours on that job. That hour difference caused the total cost of direct labor and overhead for the job to increase by over $ Are my records wrong, or was there an error in the direct labor assigned to the job?
Harris replied, Dont worry about it Roger. This job wont be used in your quarterly performance evaluation. Job AD was a federal government job, a cost plus contract, so the more costs we assign to it the more profit we make. We decided to add a few hours to the job in case there is some followup work to do You know how fussy the feds are.
a What should Roger Parker do
b What is your opinion of Harris Johnsons costing?
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