Question

Exercise 2-15 Plantwide and Departmental Predetermined Overhead Rates; Job Costs [LO2-1, LO2-2, LO2-3,LO2-4]

Part 1 of 2 Required Information Exercise 2-15 Plantwide and Departmental Predetermined Overhead Rates: Job Costs (LO2-1, LO2-2, LO2-3.LO2-4] 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 20, $ 780,00 $ 3.ee Fabrication 30, $ 210, $ 1.ee Total 50, eee $910, 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 375,00 200,00 14, 0 Fabrication Total $ 325, eee $ 700, eee $ 160,00 $ 350, eee 6, 20, Job C-200: Direct materials cost Direct labor cost Machine-hours $ $ Molding Fabrication Total 300,00 $ 250,$ 550, eee 175,00 $ 225,00 $ 400, Bee 6,eee 2 4.ee 30, Delph had no underapplied or overapplied manufacturing overhead during the year. Exercise 2-15 Part 1 Required: 1. Assume Delph uses a plantwide predetermined overhead rate based on machine-hours. 2. Compute the plantwide predetermined overhead rate. b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200. c. If Delph establishes bid prices that are 150% of total manufacturing cost, what bid prices would it have established for Job D-70 and Job C-200? d. What is Delph's cost of goods sold for the year? Answer is complete but not entirely correct. Complete the question by entering your answers in the tabs given below. Required 1A Required 1B Required 10 Required 1D Assume Delph uses a plantwide predetermined overhead rate based on machine-hours. Compute the plantwide predetermined overhead rate. (Round your answer to 2 decimal places.) Predetermined overhead rate 20.20 BHI Required 1A Required 1B >

Answer 1

Solution 1a to 1d:

Computation of Plantwide predetermined Overhead Rate
Fixed Manufacturing Overhead costs	$9,10,000
Variable Manufacturing Overhead cost [(20000*$3) + (30000*$1)]	$90,000
Total Estimated Overhead costs (a)	$10,00,000
/Total Estimated Machine Hours (b)	50000
Plantwide Overhead Rate (a/b)	$20.00
Computation of Total Manufacturing Costs
	Job D-70	Job C-200
Direct Material Costs	$7,00,000	$5,50,000
Direct Labor Costs	$3,60,000	$4,00,000
Manufacturing Overhead costs (Total Machine Hours*$20)	$4,00,000	$6,00,000
Total Manufacturing Costs	$14,60,000	$15,50,000
Computation of Bid Prices
	Job D-70	Job C-200
Total Manufacturing Costs	$14,60,000	$15,50,000
Bid price (Total Manufacturing Costs*150%)	$21,90,000	$23,25,000
Computation of Delph's Cost of Goods sold
Total Manufacturing Costs of Job D-70	$14,60,000
Total Manufacturing Costs of Job C-200	$15,50,000
Total Cost of Goods sold	$30,10,000