Question

Saved Help Consider a company who uses a job-order costing system with a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, the company made the following estimates: Machine-hours required to support estimated production Fixed manufacturing overhead cost Variable manufacturing overhead cost per machine-hour 165,000 $ 1,980,000 $ 2.00 17 Required: 1. Compute the plantwide predetermined overhead rate. 2. During the year, Job P90 was started, completed, and sold to the customer for $2,500. The following information was available with respect to this job: Direct materials Direct labor cost Machine-hours used $ 1,150 $ 830 72 Compute the total manufacturing cost assigned to Job P90. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the plantwide predetermined overhead rate. Predetermined overhead rate per MH

Answer 1

1. Predetermined OH rate=$14.00 per MH;

2. Total manufacturing Cost= $2,988.

1 Predetermined OH Rate= 14.00 per MH Total Overhead Cost Total Machine Hour $1,980,000+[$2.00*165,000] 165,000 $ 2,310,000 $ 165,000 2 Particulars Direct materials Direct Labor Cost Overhead cost Total Manufacturing cost $ $ S $ Job 90 Workings 1,150 830 1,008 ($14.00*72 MH] 2,988 Particulars Selling Price Total Manufacturing cost Net Loss Job 90 $ 2,500 $ 2,988 -$ 488

*Total Manufacturing Overhead Cost = Fixed MOH + Variable MOH;

*Total Manufacturing Overhead Cost = Fixed MOH + (Estimated MH* Variable MOH cost per MH).

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