Question

COTB MC Qu. 2-69 (Algo) Assume a company started and completed... Assume a company started and completed numerous jobs during July-one of which was Job Z. The company uses two departmental predetermined overhead rates. The rate in the Machining Department is based on machine-hours and the rate in the Assembly Department is based on direct labor-hours. The following additional information from the month of July is available for the company as a whole and for Jobs z Machining $48,000 $ 1.50 Assembly $30,000 $ 2.00 Estimated total fixed manufacturing overhead Estimated variable manufacturing overhead per machine-hour Estimated variable manufacturing overhead per direct labor-hour Estimated total machine-hours to be used Estimated total direct labor hours to be worked 12,000 10,000 Job z Direct materials Direct labor Machine-hours Direct labor-hours Machining $1,250 $ 200 40 Assembly $1,300 $ 900 60

Answer 1

10. Selling price for a unit in Job T687 is:

$403.20 or $403.

Working

Plantwide overhead rate = variabe cost per machine hour + fixed cost per machine hour

Plantwide overhead tate = $4 + (575700/30300) = $23

Total cost of Job T687

Material cost $730

Labour cost $1460

Overhead cost $690 ($23*30 hours)

Total cost $2880

Total units 10

Cost per unit $ 288

Add: Markup 40% $115.20

Selling Price per unit = $403.20