Question

Wilmington Company has two manufacturing departments --Assembly and Fabrication. It considers all of its manufacturing overhead costs to be fixed costs. The first set of data that is shown below is based on estimates from the beginning of the year. The second set of data relates to one particular job completed during the year--Job Bravo Estimated Data Manufacturing overhead costs Direct labor-hours Machine-hours Assembly $ 3,960,000 110,eee 44,000 Fabrication Total $4,400,eee 58,360, eee 66,eee 176, eee 220, eee 264, Bee Assembly Fabrication total Job Bravo Direct labor-hours Machine-hours 15 33 Required: 1. If Wilmington used a plantwide predetermined overhead rate based on direct labor-hours, how much manufacturing overhead would be applied to Job Bravo? 2. If Wilmington uses departmental predetermined overhead rates with direct labor-hours as the allocation base in Assembly and machine-hours as the allocation base in Fabrication, how much manufacturing overhead would be applied to Job Bravo? (Round your intermediate calculation to 2 decimal places.) Plantwide manufacturing overhead applied to Job Bravo Manufacturing overhead applied from Assembly to Job Bravo Manufacturing overhead applied from Fabrication to Job Bravo Total departmental manufacturing overhead applied to job Bravo

Answer 1

Manufactruing Overhead Cost Direct Labor Hours Machine Hours Assembly 3960000 110000 44000 Fabrication 4400000 66000 220000 Total 8360000 176000 264000 Plant Wide Overhead Rate = Manufactring Overhead / Direct Labor Hours Plant Wide Overhead (8360000/176000) 47.50 Activity Rate : Assembley (3960000/44000) 36.00 Fabrication (4400000/220000) 20.00 Answers 1 Plantwide Manufacturing OH Applied to Job-Bravo = (38*47.50) 2 MOH Applied to Assembly to Job Bravo= (23*36) MOH Applied to Fabrication to Job Bravo=(18*20) Total Depratmental MOH Applied to Job Bravo 1805 828 360 1188