Question

Required information The Foundational 15 (LO2-1, LO2-2, LO2-3, LO2-4) [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 2,500 $11,250 $ 1.90 Fabrication 1,500 $15,750 $ 2.70 Total 4,000 $27,000 Job P $18,000 $25,000 Job Q $ 10,500 $ 9,500 Direct materials Direct labor cost Actual machine-hours used: Molding Fabrication Total 2,200 1,100 3,300 1,300 1,400 2,700 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.

Answer 1

Answer 1.

Molding Department:

Estimated manufacturing overhead = Estimated variable manufacturing overhead per machine hour * Estimated machine hours + Estimated fixed manufacturing overhead
Estimated manufacturing overhead = $1.90 * 2,500 + $11,250
Estimated manufacturing overhead = $16,000

Predetermined overhead rate = Estimated manufacturing overhead / Estimated machine hours
Predetermined overhead rate = $16,000 / 2,500
Predetermined overhead rate = $6.40 per machine hour

Fabricating Department:

Estimated manufacturing overhead = Estimated variable manufacturing overhead per machine hour * Estimated machine hours + Estimated fixed manufacturing overhead
Estimated manufacturing overhead = $2.70 * 1,500 + $15,750
Estimated manufacturing overhead = $19,800

Predetermined overhead rate = Estimated manufacturing overhead / Estimated machine hours
Predetermined overhead rate = $19,800 / 1,500
Predetermined overhead rate = $13.20 per machine hour

Answer 2.

Job P:

Manufacturing overhead applied for Molding department = $6.40 * 2,200
Manufacturing overhead applied for Molding department = $14,080

Job Q:

Manufacturing overhead applied for Molding department = $6.40 * 1,300
Manufacturing overhead applied for Molding department = $8,320

Answer 3.

Job P:

Manufacturing overhead applied for Fabrication department = $13.20 * 1,100
Manufacturing overhead applied for Fabrication department = $14,520

Job Q:

Manufacturing overhead applied for Fabrication department = $13.20 * 1,400
Manufacturing overhead applied for Fabrication department = $18,480

Answer 4.

Job P:

Manufacturing overhead applied = Manufacturing overhead applied for Molding department + Manufacturing overhead applied for Fabrication department
Manufacturing overhead applied = $14,080 + $14,520
Manufacturing overhead applied = $28,600

Total manufacturing cost = Direct materials + Direct labor + Manufacturing overhead applied
Total manufacturing cost = $18,000 + $25,000 + $28,600
Total manufacturing cost = $71,600

Answer 5.

Unit product cost = Total manufacturing cost / Units produced
Unit product cost = $71,600 / 20
Unit product cost = $3,580