Question

(The following information applies to the questions displayed below.) 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 $10,000 Estimated variable manufacturing overhead per machine-hour $25,000 $15,000 $ 2.20 $ 1.40 Job P $13,000 $21,000 Job o $8,000 $7,500 Direct materials Direct labor cost Actual machine-hours used: Molding Fabrication Total 1,700 600 2,300 800 900 1,700 Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month. Required: For questions 1-9, assume that Sweeten Company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments and Job P included 20 units and Job Q included 30 units. For questions 10-15, assume that the company uses a plantwide predetermined overhead rate with machine-hours as the allocation base. Foundational 2-12 (Static) 12. If Job P included 20 units, what was its unit product cost? (Do not round Intermediate calculations. Round your final answer to nearest whole dollar.) Unit product cost

Answer 1

For Molding,

Predetermined Overhead Rate = Fixed Overhead / Machine Hours

= $ 10,000 / 2,500

= $ 4 per hours

For Fabrication,

Pre determined Overhead Rate = Fixed Overhead / Machine Hours

= $ 15,000 / 1,500

= $ 10 per hours

For Job P ,

Direct Materials = $ 13,000

Direct Labours = $ 21,000

Overhead :

Molding -

Variable ($1.40 per hour) = $ 2,380

Fixed ($4 per hour) = $ 6,800

Fabrication -

Variable ($ 2.20 per hour) = $ 1,320

Fixed ($ 10 per hour) = $ 6,000

Total Cost = $ 50,500

Total Units in Job P = 20 units

Unit Product Cost = $ 50,500 / 20 = $ 2,525

Ans : Unit Product Cost = $ 2,525 per unit

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