Question

Bonita Inc. has identified the following overhead costs and cost drivers for next year.

Overhead Item		Expected Cost				Cost Driver		Expected Actual Transactions
Setup costs			$87,912			No. of setups		396
Ordering costs			46,800			No. of orders		3,900
Maintenance costs			125,000			Machine hours		25,000
Power			26,495			Kilowatt hours		75,700

The following are two of the jobs completed during the year:

		Job 700				Job 701
Direct materials			$1,200				$600
Direct labour			$890				$420
Units completed			250				100
Direct labour hours			40				20
Number of setups			2				1
Number of orders			11				4
Machine hours			50				37
Kilowatt hours			65				28

The company's normal activity is 4,800 direct labour hours.

Determine the unit cost for each job using direct labour hours to apply overhead. (Round overhead rate and final answers to 2 decimal places, e.g. 15.25.)

		Cost
Job 700		$	per unit
Job 701		$	per unit

Determine the unit cost for each job using the four cost drivers. (Round overhead rates and final answers to 2 decimal places, e.g. 15.25.)

		Cost
Job 700		$	per unit
Job 701		$	per unit

Answer 1

В НА Job 700 Job 701 396 A/B $222 $12 2 Job 701 $222 $48 11 Job 700 $444 $132 $250 Setup costs Ordering costs Maintenance costs Power 3,900 25,000 75,700 4 37 $5 50 ΑΑ $87,912 $46,800 $1,25,000 $26,495 $2,86,207 4,800 $59.63 $185 $0.35 65 28 $23 $10 $849 $465 Direct labor Overhead per DLH. Direct material Direct labor Overhead Job 700 Job701 $1,200 $600 $890 $420 $2,385.2 $1,192.6 $4,475.20 $2,212.60 250 100 $17.90 $22.13 Units Direct material Direct labor Overhead Job 700 $1,200 $890 $849.0 $2,939.00 250 $11.76 Job701 $600 $420 $465.0 $1,485.00 100 $14.85 Units