Question

7 2, LO2-3, L02-4) (The following information applies to the questions displayed below.) Delph Company uses a job-order costing system and has two manufacturing departments–Molding and Fabrication. The company provided the following estimates at the beginning of the year: Part 2 of 2 Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead cost per machine-hour 1.48 points Molding Fabrication 24,000 31,000 $760,000 $ 240,000 $ 3.00 $ 2.00 Total 55,000 $1,000,000 Skipped During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobs, Job D-70 and Job C-200. It provided the following information related to those two jobs: eBook Job D-70 Direct materials cost Direct labor cost Machine-hours Molding Fabrication Total $ 370,000 $ 320,000 $690,000 $ 200,000 $ 160,000 $360,000 14,000 10,000 24,000 Print Job C-200 Direct materials cost Direct labor cost Machine-hours Molding Fabrication Total $ 300,000 $ 200,000 $500,000 $ 120,000 $ 260,000 $380,000 10,000 21,000 31,000 References Delph had no underapplied or overapplied manufacturing overhead during the year. Exercise 2-15 (Algo) Part 2 2. Assume Delph chooses to combine its departmental rates from requirement 1 into a plantwide predetermined overhead rate based on machine-hours. a. Compute the plantwide predetermined overhead rate. b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200. c. If Delph establishes bid prices that are 150% of total manufacturing costs, what bid prices would it have established for Job D-70 and Job C-200? d. What is Delph's cost of goods sold for the year?

Answer 1

1(a)
Plant wise overhead rate
Total Overhead	=	1000000+(24000*3)+(31000*2)
		$11,34,000
Plant wise overhead rate		1134000/(24000+31000)
			20.61818182
			20.62
1(b)
Calculation of the manufecturing cost assigned to
Job D-70
		Modeling	Fabrication	Total
Direct Material Cost	$3,70,000	$3,20,000	$6,90,000
Direct Labor Cost	$2,00,000	$1,60,000	$3,60,000
Overhead (Predetermined)	14000*20.62	10000*20.62
		$2,88,680	$2,06,200	$4,94,880
				$15,44,880
Job C-200
		Modeling	Fabrication	Total
Direct Material Cost	$3,00,000	$2,00,000	$5,00,000
Direct Labor Cost	$1,20,000	$2,60,000	$3,80,000
Overhead (Predetermined)	10000*20.62	21000*20.62
		$2,06,200	$4,33,020	$6,39,220
				$15,19,220
1©
Bid price would be
job d-70	150%*1544880
	$23,17,320
job C-200	150%*1519220
	$22,78,830
1(d)

Because the company has no beginning or ending inventories and only Jobs D-70 and C-200 were started, completed, and sold during the year, the cost of goods sold is equal to the sum of the manufacturing costs assigned to both jobs of

Job- d-70	$15,44,880
Job c-300	$15,19,220
Total	$30,64,100