Question

Mickley Company’s plantwide predetermined overhead rate is $24.00 per direct labor-hour and its direct labor wage rate is $13.00 per hour. The following information pertains to Job A-500:

Direct materials	$	240
Direct labor	$	130

Required:

1. What is the total manufacturing cost assigned to Job A-500?

2. If Job A-500 consists of 80 units, what is the unit product cost for this job?

Answer 1

Manufacturing overhead ($130 / $13) * $24	$240
Direct material	$240
Direct labor	$130
Total manufacturing cost	$610

2.

Unit product cost = Total manufacturing cost / units

= $610 / 80

= $7.625 per unit