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 $ 710,000 $ 210,000 $ 5.70 $ 5.70 Total 66,000 $920,000 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 $ 373,000 $322,000 $ 695,000 $ 210,000 $ 180,000 $ 390,000 22,000 6,000 28,000 Job C-200: Direct materials cost Direct labor cost Machine-hours Molding Fabrication Total $ 250,000 $ 280,000 $530,000 $ 140,000 $ 270,000 $ 410,000 6,000 32,000 38,000 Delph had no underapplied or overapplied manufacturing overbead during the year.

Answer 1

1
a.	Plantwide predetermined overhead rate=Estimated total manufacturing overhead/Estimated machine hours
	Estimated total manufacturing overhead:
							Molding	Fabrications	Total
	Estimated total machine hours used					a	28000	38000	66000
	Variable manufacturing overhead per machine hour					b	5.7	5.7
	Variable manufacturing overhead					c=a*b	159600	216600	376200
	Fixed manufacturing overhead						710000	210000	920000
	Total manufacturing overhead						869600	426600	1296200
	Plantwide predetermined overhead rate=1296200/66000=$ 19.64 per machine hour
b.	Total manufacturing cost assigned
						D-70	C-200
	Direct materials					373000	322000
	Direct labor cost					210000	180000
	Manufacturing overhead applied				(Note:1)	549920	746320
	Total manufacturing cost assigned					1132920	1248320
	Manufacturing overhead applied=Machine hours*Plantwide predetermined overhead rate
	D-70	Manufacturing overhead applied=28000*19.64=$ 549920
	C-200	Manufacturing overhead applied=38000*19.64=$ 746320
c.	Bid price=150% of manufacturing cost
						D-70	C-200
	Total manufacturing cost assigned				(a)	1132920	1248320
	Bid price				(a)*150%	1699380	1872480
d.	Cost of goods sold=Total manufacturing cost of two jobs=1132920+1248320=$ 2381240
2
a.	Departmental overhead rate=Estimated total manufacturing overhead for the department/Estimated machine hours for the department
	Estimated total manufacturing overhead:
							Molding	Fabrications
	Estimated total machine hours used					a	28000	38000
	Variable manufacturing overhead per machine hour					b	5.7	5.7
	Variable manufacturing overhead					c=a*b	159600	216600
	Fixed manufacturing overhead					d	710000	210000
	Total manufacturing overhead					e=c+d	869600	426600
	Departmental overhead rate					f=e/a	31.06	11.23
b.	Total manufacturing cost assigned
						D-70	C-200
	Direct materials					373000	322000
	Direct labor cost					210000	180000
	Manufacturing overhead applied				(Note:1)
	Molding					683320	186360
	Fabrications					67380	359360
	Total manufacturing cost assigned					1333700	1047720
	Manufacturing overhead applied=Machine hours*Departmental overhead rate
	D-70
	Molding		Manufacturing overhead applied=22000*31.06=$ 683320
	Fabrications		Manufacturing overhead applied=6000*11.23=$ 67380
	C-200	Manufacturing overhead applied=38000*19.64=$ 746320
	Molding		Manufacturing overhead applied=6000*31.06=$ 186360
	Fabrications		Manufacturing overhead applied=32000*11.23=$ 359360
c.	Bid price=150% of manufacturing cost
						D-70	C-200
	Total manufacturing cost assigned				(a)	1333700	1047720
	Bid price				(a)*150%	2000550	1571580
d.	Cost of goods sold=Total manufacturing cost of two jobs=1333700+1047720=$ 2381240