Question

Required information [The following information applies to the questions displayed below.] Delph Company uses a job-order costing system and has two manufacturing departments-Molding and Fabrication. The company provided the following estimates at the beginning of the year: Machine-hours Fixed manufacturing overhead costs Variable manufacturing overhead cost per machine-hour Molding Fabrication 28,000 38,000 $ 790,000 $ 270,000 $ 6.00 $ 6.00 Total 66,000 $1,060,000 During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobs- Job D-70 and Job C-200. It provided the following information related to those two jobs: Job D-70: Direct materials cost Direct labor cost Machine-hours Molding Fabrication Total $ 375,000 $ 322,000 $ 697,000 $ 210,000 $ 130,000 $ 340,000 20,000 8,000 28,000 Job C-200: Direct materials cost Direct labor cost Machine-hours Molding Fabrication Total $ 280,000 $ 260,000 $540,000 $ 140,000 $ 240,000 $ 380,000 8,000 30,000 38,000 Delph had no underapplied or overapplied manufacturing overhead during the year.

Answer 1

a)	Predetermined overhead rates
	= (total fixed overhead / total machine hours)+ Variable overhead per machine hour
	= ($1060000/66000)+$6 per machine hour
	=$22.06
	total manufacturing cost recorded for D70
b)		Department		Total
		Molding	Fabrication
	Direct materials	$                3,75,000	$           3,22,000	$     6,97,000
	Direct labor	$                2,10,000	$           1,30,000	$     3,40,000
	Manufacturing overhead	$                4,41,200	$           1,76,480	$     6,17,680
	Total cost	$              10,26,200	$           6,28,480	$   16,54,680
	total manufacturing cost recorded for C200
		Department
		Molding	Fabrication	Total
	Direct materials	$                2,80,000	$           2,60,000	$     5,40,000
	Direct labor	$                1,40,000	$           2,40,000	$     3,80,000
	Manufacturing overhead	$                1,76,480	$           6,61,800	$     8,38,280
	Total cost	$                5,96,480	$         11,61,800	$   17,58,280
c)		D-70	C-200
	Total Manufacturing Cost	$              16,54,680	$         17,58,280
	Add:
	Markup @150%	$          24,82,020.0	$     26,37,420.0
	Bid Price	$        41,36,700.00	$   43,95,700.00
d)	Cost of goods sold =$596480+1161800
	$                   17,58,280