Question

Harnett Corporation has two manufacturing departments--Molding and Assembly. The company used the following data at the beginning of the period to calculate predetermined overhead rates:

	Molding		Assembly		Total
Estimated total machine-hours (MHs)		3,000		7,000		10,000
Estimated total fixed manufacturing overhead cost	$	24,000	$	53,200	$	77,200
Estimated variable manufacturing overhead cost per MH	$	1.00	$	2.00

During the period, the company started and completed two jobs--Job E and Job M. Data concerning those two jobs follow:

	Job E		Job M
Direct materials	$	21,600	$	9,300
Direct labor cost	$	22,600	$	9,500
Molding machine-hours		2,500		500
Assembly machine-hours		2,500		4,500

Required:

g. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. How much manufacturing overhead will be applied to Job E? (Do not round intermediate calculations.)

h. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. Further assume that the company uses a markup of 20% on manufacturing cost to establish selling prices. Calculate the selling price for Job E. (Do not round intermediate calculations.)

g. Manufacturing overhead applied job E h. Selling price for jobE

Answer 1