Question

All one problem just broken up into multiple pictures because theres four parts. THANK YOU!

High Desert Potteryworks makes a variety of pottery products that it sells to retailers. The company uses a job-order costing system in which departmental predetermined overhead rates are used to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Molding Department is based on machine hours, and the rate in the Painting Department is based on direct labor- hours. At the beginning of the year, the company provided the following estimates: Direct labor-hours Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour Department Molding Painting 39,000 59,700 84,000 38.000 $193,200 $489,540 $ 3.20 $ 5.20 Job 205 was started on August 1 and completed on August 10. The company's cost records show the following information concerning the job: Direct labor-hours Machine-hours Direct materials Direct labor cost Department Molding Painting 87 134 330 72 $ 944 $1,160 $ 750 $ 960 Required: 1. Compute the predetermined overhead rates used in the Molding Department and the Painting Department 2. Compute the total overhead cost applied to Job 205.

Answer 1

Requirements: 1) Predetermine overhead rates for Molding Department & Painting Department Molding department rate = (193200/84000)+3.2 $ 5.50 Per Machine Hours Painting department rate = (489540/59700)+5.2 $ 13.40 Per Direct Labour Hours Requirement2: 2)Totoal Over Head Cost Applied to Job 205 Total overhead cost = (330*5.5+134*13.4) $ 3,610.60 Requirement3A: 3) Total manufacturing cost for Job 205 Particulars Molding Painting Total Direct material $ 944.00 $ 1,160.00 $2,104.00 Direct labor $ 750.00 $ 860.00 $1,610.00 Manufacturing $ 1,815.00 $ 1,795.60 $ 3,611 Total Cost $3,509.00 $3,815.60 $7,324.60 Requirement3B: Unit product cost = 7324.6/37 $ 197.96 Per Unit * Kindly Comment down for any clarifications/ queries and please upvote.