Question

Bula Corporation has two production departments, Machining and Customizing The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Machining Department's predetermined overhead rate is based on machine-hours and the Customizin beginning of the current year, the company had made the following estimates g Department's predetermined overhead rate is based on direct labor-hours. At the chining Custonizing 13,000 Machine hours Direet 1abor-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manutacturing overhead per direct labor-hour 3, 000 562, 00 $ 2.50 10, 000 t, 000 $4,000 s 5.00 During the current month the company started and finished Job K369. The following data were recorded for this job: 69 Machine-houra Direct labor-hours 90 10 20 90 Required: Calculate the total amount of overhead applied to Job K369 in both departments. (Do not round intermediate calculations.)

Answer 1

Machining Department

Total overhead cost = $62,400 + (13,000 hrs* $2.5)

= $94,900

Predetermined overhead cost = $94,900/13,000 hrs

= $7.3

Overhead applied to Job = $7.3*90

= $657

Customizing Department

Total overhead cost = $44,000 + (4,000hrs*5)

= $64,000

Predetermined overhead cost = $64,000/4,000hrs

= $16

Overhead applied to Job = $16*90

= $1,440