Question

please help i do not understand this practice problem and cant find the right answer. managerial accounting

Comans Corporation has two production departments, Milling and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Milling Department's predetermined overhead rate is based on machine-hours and the Customizing Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: Milling Customizing Machine-hours Direct labor-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor- 25,e00 15,eee $132,500 10, eee 4,000 $22,e0e 1.80 $ 3.90 hour During the current month the company started and finished Job A319. The following data were recorded for this job: Job A319: Machine-hours Direct labor-hours Direct materials Direct labor cost Milling Customizing 70 20 30 40 $ 630 $ 740 $ 170 $ 510 If the company marks up its manufacturing costs by 10% then the selling price for Job A319 would be closest to: (Round your intermediate calculations to 2 decimal places.)

Answer 1

Answer is $3,215

Milling Department:

Estimated manufacturing overhead = Estimated variable manufacturing overhead per machine hour * Estimated machine hours + Estimated fixed manufacturing overhead
Estimated manufacturing overhead = $1.80 * 25,000 + $132,500
Estimated manufacturing overhead = $177,500

Predetermined overhead rate = Total estimated manufacturing overhead / Total estimated machine hours
Predetermined overhead rate = $177,500 / 25,000
Predetermined overhead rate = $7.10 per machine hour

Manufacturing overhead applied = Predetermined overhead rate * Actual machine hours
Manufacturing overhead applied = $7.10 * 70
Manufacturing overhead applied = $497

Total manufacturing cost = Direct materials + Direct labor + Manufacturing overhead applied
Total manufacturing cost = $630 + $740 + $497
Total manufacturing cost = $1,867

Customizing Department:

Estimated manufacturing overhead = Estimated variable manufacturing overhead per labor hour * Estimated labor hours + Estimated fixed manufacturing overhead
Estimated manufacturing overhead = $3.90 * 4,000 + $22,000
Estimated manufacturing overhead = $37,600

Predetermined overhead rate = Total estimated manufacturing overhead / Total estimated labor hours
Predetermined overhead rate = $37,600 / 4,000
Predetermined overhead rate = $9.40 per labor hour

Manufacturing overhead applied = Predetermined overhead rate * Actual labor hours
Manufacturing overhead applied = $9.40 * 40
Manufacturing overhead applied = $376

Total manufacturing cost = Direct materials + Direct labor + Manufacturing overhead applied
Total manufacturing cost = $170 + $510 + $376
Total manufacturing cost = $1,056

Manufacturing cost for Job A319 = Total manufacturing cost for Milling Department + Total manufacturing cost for Customizing Department
Manufacturing cost for Job A319 = $1,867 + $1,056
Manufacturing cost for Job A319 = $2,923

Selling price for Job A319 = Manufacturing cost + Markup
Selling price for Job A319 = $2,923 + 10% * $2,923
Selling price for Job A319 = $3,215