Question

Lupo Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on the following data: Total machine-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine- hour 30,500 $610,000 $ 6.00 Recently, Job T687 was completed with the following characteristics: Number of units in the 10 job Total machine-hours Direct materials Direct labor cost 30 $ 690 $1,370 The unit product cost for Job T687 is closest to: Multiple Choice 0 $147.00 0 $206.00 0 $284.00 0 $94.67

Answer 1

Fixed manufacturing overhead cost per machine hour = Total fixed manufacturing overhead cost / Total macine hours ($ 610,000 / 30,500 MHS) $ 20 per machine hour Unit product cost for Job T687 Direct materials Direct labor cost Fixed manufacturing overhead cost Variable manufacturing overhead cost Total cost Number of units in the job Unit product cost for Job T687 $ $ $ $ $ 690 1,370 600 ($ 30 MHs * $ 20) 180 ($ 30 MHs * $ 6) 2,840 $ 284 ($ 2,840 / 10 units) Answer is option third - $ 284.00