Question

Wilbur Company has two manufacturing departments--Assembly and Fabrication. It considers all of its manufacturing overhead costs to be fixed costs. The first set of data that is shown below is based on estimates from the beginning of the year. The second set of data relates to one particular job completed during the year--Job Bravo.

Estimated Data	Assembly		Fabrication		Total
Manufacturing overhead costs	$	960,000	$	1,200,000	$	2,160,000
Direct labor-hours		60,000		36,000		96,000
Machine-hours		24,000		120,000		144,000

Job Bravo	Assembly	Fabrication	Total
Direct labor-hours	13	5	18
Machine-hours	5	8	13

Required:

1. If Wilbur used a plantwide predetermined overhead rate based on direct labor-hours, how much manufacturing overhead would be applied to Job Bravo?

2. If Wilbur uses departmental predetermined overhead rates with direct labor-hours as the allocation base in Assembly and machine-hours as the allocation base in Fabrication, how much manufacturing overhead would be applied to Job Bravo?

(Round your intermediate calculation to 2 decimal places.)

1. Plantwide manufacturing overhead applied to Job Bravo 2. Manufacturing overhead applied from Assembly to Job Bravo Manufacturing overhead applied from Fabrication to Job Bravo Total departmental manufacturing overhead applied to Job Bravo

Answer 1

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1	Plant-wide manufacturing overhead applied to job Bravo	=	$        405
2	Manufacturing overhead applied from Assembly to Job Bravo	=	$        208
Add:	Manufacturing overhead applied from Fabrication to Job Bravo	=	$          80
	Total departmental overhead applied to Job Bravo	=	$        288
	Workings:
1	Plant-wide manufacturing overhead applied to job Bravo	=	(Total Manufacturing overhead cost / Total DLH) DLH applied to Bravo
		=	($2160000 / 96000) X 18
		=	$        405
2	Manufacturing overhead applied from Assembly to Job Bravo	=	(Assembly Manufacturing overhead cost / Direct labor hours) X $11
		=	($960000 / 60000) X 13
		=	$        208
	Manufacturing overhead applied from Fabrication to Job Bravo	=	(Fabrication Manufacturing overhead cost / Machine hours) X $6
		=	($1200000 / 120000) X 8
		=	$          80