Question

Sweeten Company had no jobs in progress at the beginning of March and no beginning inventories. The company has two manufacturing departments--Molding and Fabrication. It started, completed, and sold only two jobs during March—Job P and Job Q. The following additional information is available for the company as a whole and for Jobs P and Q (all data and questions relate to the month of March):

	Molding			Fabrication			Total
Estimated total machine-hours used		2,500			1,500			4,000
Estimated total fixed manufacturing overhead	$	14,250		$	17,550		$	31,800
Estimated variable manufacturing overhead per machine-hour	$	3.10		$	3.90

	Job P			Job Q
Direct materials	$	30,000		$	16,500
Direct labor cost	$	34,600		$	14,300
Actual machine-hours used:
Molding		3,400			2,500
Fabrication		2,300			2,600
Total		5,700			5,100

Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month.

Required:

For questions 1-8, assume that Sweeten Company uses a plantwide predetermined overhead rate with machine-hours as the allocation base. For questions 9-15, assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments.

7. Assume that Sweeten Company used cost-plus pricing (and a markup percentage of 80% of total manufacturing cost) to establish selling prices for all of its jobs. What selling price would the company have established for Jobs P and Q? What are the selling prices for both jobs when stated on a per unit basis assuming 20 units were produced for Job P and 30 units were produced for Job Q? (Do not round intermediate calculations. Round your final answers to nearest whole dollar.)

	Job P Job Q Total price for the job Selling price per unit

Answer 1

7)

      Job P Job Q

Total price of the Job                         $197847``                          $128421

Selling Price per unit                       $ 9892.35                             $4280.7

Particulars	Job P	Job Q
Direct Materials	$ 30000	$ 16500
Direct Labor	$ 34600	$ 14300
Overheads	$ 45315 ($7.95*5700)	$ 40545 ( $7.95*5100)
Total Cost	$109915	$ 71345
Mark-Up (80% of the Total manufacturing Cost)	$ 87932	$ 57076
Price of the Job(as per cost plus Pricing)	$197847	$128421
Number Of Units	20	30
Selling Price per unit	$9892.35	$4280.7

Pre determined overhead rate= Total overheads/Total machine hours

       =$ 31800/4000 hours=$ 7.95 per hour