Question

Sweeten Company had no jobs in progress at the beginning of March and no beginning inventories. The company has two manufacturing departments--Molding and Fabrication. It started, completed, and sold only two jobs during March-Job P and Job Q. The following additional information is available for the company as a whole and for Jobs P and Q (all data and questions relate to the month of March): Estimated total machine-hours used Estimated total fixed manufacturing overhead Estimated variable manufacturing overhead per machine- hour Molding Fabrication Total 2,500 1,500 4,000 $10,750 $ 15,450 $26,200 $ 1.79 $ 2.50 Job P $16,000 $23,400 Job Q $9,500 $8,700 Direct materials Direct labor cost Actual machine-hours used: Molding Fabrication Total 2,000 900 2,900 1,100 1,200 2,300 Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month. Requlred: For questions 1-8, assume that Sweeten Company uses a plantwide predetermined overhead rate with machine-hours as the allocation base. For questions 9-15. assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments. 3. What was the total manufacturing cost assigned to Job P? (Do not round Intermediate calculations.) Total manufacturing cost

Answer 1

Answer
The total manufacturing cost assigned to Job P = $65,645
Working Notes:
Predetermined overhead rate = Total estimated manufacturing overhead / Total estimated machine hours
	Estimated variable manufacturing overhead
		2,500 x 1.70 + 1,500 X 2.5
		$4250+$3750
		$8,000
	Estimated fixed manufacturing overhead = $ 10,750 + $ 15,450 = $26,200
	Estimated total manufacturing overhead = $8,000 + $26,200 = $36,200
	Pre-determined manufacturing OH rate = Estimated total manufacturing overhead / Total estimated machine hours
		$36200/4000
		$ 9.05 per machine hours
	The total manufacturing cost assigned to Job P= Manufacturing OH + Direct labor + Direct material
	(Total machine hours used for Job P x Pre-determined manufacturing OH rate) + Direct Labor for Job P+ Direct Material for Job P
		((2,000 + 900) machine hours x $9.05 + $16,000 + $23,400)
		$26,245 + $16000+ $23400
		$65,645