Question

Required information (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 Fabrication 25,000 35,000 $ 710,000 $ 290,000 $ 5.80 $ 5.80 Total 60,000 $1,000,000 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 Fabrication Total $ 379,000 $ 326,000 $ 705,000 $ 230,000 $ 170,000 $ 400,000 18,000 7,000 25,000 Job C-200: Direct materials cost Direct labor cost Machine-hours Molding Fabrication Total $ 230,000 $ 250,000 $ 480,000 $ 100,000 $ 230,000 $ 330,000 7,000 28,000 35,000 Delph had no underapplied or overapplied manufacturing overhead during the year.

Answer 1

a)	Computation of departmental predetermined OH rates
	Particulars			Molding	Fabrication
	Fixed Manu. OH cost			$ 710,000.00	$ 290,000.00
	Machine Hours			25000	35000
	Fixed OH rate per hour			$           28.40	$             8.29
	Variable OH rate per hour			$             5.80	$             5.80
	Predetermined OH rate			$           34.20	$           14.09

b)	Computation of Manufacturing cost assigned to:
	Job D - 70
	Department		Materials	Labor	OH			Total
	Molding		$ 379,000.00	$ 230,000.00	$ 615,600.00	(18000 x $ 34.20)
	Fabrication		$ 326,000.00	$ 170,000.00	$   98,600.00	(7000 x $ 14.09)
			$ 705,000.00	$ 400,000.00	$ 714,200.00			$ 1,819,200.00
	Job C-200
	Department		Materials	Labor	OH			Total
	Molding		$ 230,000.00	$ 100,000.00	$ 239,400.00	(7000 x $ 34.20)
	Fabrication		$ 250,000.00	$ 230,000.00	$ 394,400.00	(28000 x $ 14.09)
			$ 480,000.00	$ 330,000.00	$ 633,800.00			$ 1,443,800.00

c)	Particulars				Job D - 70	Job C-200
	Total Manufacturing Cost			(a)	$ 1,819,200.00	$ 1,443,800.00
	Bid prices			(a x 150%)	$ 2,728,800.00	$ 2,165,700.00

d)

Cost of Goods sold

$ 3,263,000.00

($ 1819200 + $ 1443800)