1. The Green Company makes tables. Job 489 is to build 20 tables. Job 489 requires...

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1. The Green Company makes tables. Job 489 is to build 20 tables. Job 489 requires...

1. The Green Company makes tables. Job 489 is to build 20 tables.

Job 489 requires $680 of direct materials and 30 hours of direct labor costing $530. Also use the following information about the company:

Total fixed manufacturing overhead cost estimated for all jobs during the whole year $480,000

Estimated direct labor hours for all jobs during the whole year 60,000

Estimated variable manufacturing overhead cost per direct labor hour $3

Calculate the following if the Green Company uses the traditional method of job order costing with one company-wide predetermined overhead rate using direct labor hours as the allocation base:

a. The predetermined overhead rate

b. The manufacturing overhead cost applied to job 489

c. The total cost of job 489

d. The cost per unit (per table)

business accounting

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Answer 1

Answer #1

a) Predetermine overhead rate = (480000/60000+3) = 11 per labor hour

b) Manufacturing overhead applied = 30*11 = 330

c) Total cost of Job 489

Direct material	680
Direct labor	530
Overhead	330
Total cost of Job 489	1540

d) The cost per unit = 1540/20 = $77

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Answer 2

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