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): Estimated total machine-hours used Estimated total fixed manufacturing overhead Estimated variable manufacturing overhead per machine-hour Molding Fabrication total 2,500 1,500 4,000 $12,250 $16,350 $28,600 $ 2.30 $ 3.10 Jobg Job P $22,000 $28,200 $12,500 $11,100 Direct materials Direct labor cost Actual machine-hours used: Molding Fabrication Total 2,600 1,500 4,109 1,700 1,800 3,500 Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month. Required: For questions 1-8, assume that Sweeten Company uses a plantwide predetermined overhead rate with machine-hours as the allocation base. For questions 9-15, assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments

Answer 1

Unit product cost    [Refer working note 1]

$2,035

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Working note 1 - Calculation of unit product cost
Direct material cost	$12,500
Direct labor cost	$11,100
Total overhead allocated    [Refer working note 2]	$37,440
Total cost                            [$12,500 + $11,100 + $37,440]	$61,040
Units included in Job Q	30
Unit product cost                 [Total cost / Units = $61,040 / 30 units]	$2,035

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Working note 2 - Calculation of total overhead allocated to Job Q
	Job Q
Molding department:
Actual machine-hours used                                                               (a)	1,700
Departmental overhead rate       [Refer working note 3]                    (b)	$7.20
Overhead allocated                                                                           (c = a x b)	$12,240
Fabrication department:
Actual machine-hours used                                                               (d)	1,800
Departmental overhead rate [Refer working note 3]                        (e)	$14.00
Overhead allocated                                                                           (f = d x e)	$25,200
Total overhead allocated                                                                          ( c + f)	$37,440

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Working note 3 - Calculation of departmental overhead rate
	Molding	Fabrication
Estimated fixed manufacturing overhead                                               (a)	$12,250	$16,350
Estimated machine-hours used                                                               (b)	2,500	1,500
Estimated fixed manufacturing overhead per machine hour                   (c = a / b)	$4.90	$10.90
Estimated variable manufacturing overhead per machine-hour               (d)	$2.30	$3.10
Departmental overhead rate                                                                    (c + d)	$7.20	$14.00