Question

9 ist said David Wilson, president of Teedex Comory we've lost the bid on e e s by 52000 her to high to get the job or too low to make any money on the web Teledex Company manufactures products to customers specifications and we a re consten Theory plantide predetermined overhead ate based on director cost co n curg ed to be obs. The following estimates were made the beginning of the year were Manufacturing overhead Fabricating machine $ 150,000 $ 400,00 $ 200,000 $100,000 Total Pant Direct 0 .00 .00 to Jobs require varying amounts of work in the three departments. The Koopers job, for example would have required manufacturing costs in the three departments as follows: prest waterials Total Plant Direst labor Required: 1 Using the company's plantwide approach a Compute the plantwide predetermined rate for the current year b. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job 2. Suppose that instead of using a plantwide predetermined overhead rate the company had used departmental predetermined Overhead rates based on direct labor cost Under these conditions: a Compute the predetermined overhead rate for each department for the current year b.Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job 4. Assume that it is customary in the industry to bid jobs at 150% of total manufacturing cost direct materials, direct labor and applied overhead) a What was the company's bid price on the Koopers job using a plantwide predetermined overhead rate? b. What would the bid price have been it departmental predetermined overhead rates had been used to apply overhead cost? Complete this question by entering your answers in the tabs below Required LA Required 1B Required 2A Revied 28 R ed Red Using the company's plantwide approach, compute the plantidepredetermined rate for the current year Pred vaadates director cost Required 18 ) Required 2A Required 28 Required 4A Required LA Required 1B Required 48 Using the company's plantwide approach, determine the amount of manufacturing overhead cost that would have been applied to the Koopers job. Manufacturing overhead cost applied Required 28 Required 4A Required 48 Required 1A Required 1B Required 2A Suppose that instead of using a plantwide predetermined overhead rate, the company had used departmental predetermined overhead rates based on direct labor cost. Compute the predetermined overhead rate for each department for the current year. Predetermined Overload Rate Fabricating department of direct labor cost

Answer 1

Required 1A :
Predetermined overhead rate = Total estimated manufacturing overhead / Total estimated direct labor = 840000 / 600000	140%	of direct labor cost

Required 1B :
Manufacturing overhead cost applied = Actual total direct labor cost * Predetermined overhead rate = 9500 * 140%	13300

Required 2A :
Predetermined overhead rate ( Estimated Manufacturing overhead / Estimated Direct labor )
Fabricating department ( 350000 / 200000 )	175%	of direct labor cost
Machining department ( 400000 / 100000 )	400%	of direct labor cost
Assembly department ( 90000 / 300000 )	30%	of direct labor cost

Required 2B:
Manufacturing overhead cost applied = ( 2800 * 175% ) + ( 500 * 400% ) + ( 6200 * 30% )	8760

Required 4A :
	Koopers Job
Direct materials	4600
Direct labor	9500
Manufacturing overhead applied	13300
Total manufacturing cost	27400
Company's bid price ( @ 150% of total manufacturing cost )	41100

Required 4B :
	Koopers Job
Direct materials	4600
Direct labor	9500
Manufacturing overhead applied	8760
Total manufacturing cost	22860
Company's bid price ( @ 150% of total manufacturing cost )	34290