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 25,000 $ 730,000 $ 6.00 Fabrication 35,000 $ 280,000 $ 6.00 Total 60,000 $1,010,000 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 $ 371,000 $ 324,000 $ 695,000 $ 230,000 $ 140,000 $ 370,000 17,000 8,000 25,000 Job C-200: Direct materials cost Direct labor cost Machine-hours Molding Fabrication Total $ 210,000 $ 220,000 $430,000 $ 120,000 $ 280,000 $ 400,000 8,000 27,000 35,000

Answer 1

2A. Calculation of Departmental Predetermined Overhead Rate based on Machine Hrs: Molding Fabrication $ Fixed Manufacturing Overhead Costs Machine Hours Predetermined Overhead Rate Per Machine Hr. 730,000.00 $ 25000.00 280,000.00 35000.00 29.20 $ 8.00

2B. Computation of total manufacturing cost assigned to Job D-70 and Job C-200: $ A Job D-70 371,000.00 $ 324,000.00 $ 230,000.00 $ 140,000.00 $ A Job C-200 210,000.00 220,000.00 120,000.00 280,000.00 A 102,000.00 $ 48,000.00 A Direct Materials - Molding Direct Materials - Fabrication Direct Labor - Molding Direct Labor - Fabrication Variable Manufacturing Overhead - Molding (17000x$6; 8000x$6) Variable Manufacturing Overhead - Fabrication (8000x$6; 27000x$6) Fixed Manufacturing Overhead - Molding (17000 x $29.20; 8000x$29.20) Fixed Manufacturing Overhead - Fabrication (8000 x $8.00; 27000x$8) Total Manufacturing Cost A 48,000.00 $ 162,000.00 $ 496,400.00 $ 233,600.00 64,000.00 $ 1,775,400.00 $ 216,000.00 1,489,600.00 $

20. Calculation of Prices of Job D-70 and Job C-200 if Bid prices are 130% of total manufacturing Costs: Job D-70 1,775,400.00 Job C-200 1,489,600.00 $ $ Total Manufacturing Cost Price (130% x $1,775,400); (130% x $1,489,600) $ 2,308,020.00 $ 1,936,480.00 2D. Calculation of Cost of Goods Sold for the Year: In this case, company produced and sold only two jobs (Job D-70 & C-200). So the cost of goods sold equals to total manufacturing cost of these two jobs. So, Cost of Goods Sold = $2,308,020 + $1,936,480 = $4,244,500.00