Question

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 overhead machine-hour Molding Fabrication Total 2,500 1,500 4,000 $12,750 $16,650 $29,400 $ 2.50 $ 3.30 Job P $24,000 $29,800 Job $13,500 $11,900 Direct materials Direct labor cost Actual machine-hours used: Molding Fabrication Total 2,800 1,700 4,500 1,900 2,000 3,900 Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month.

Answer 1

Solution 7:

Predetermined overhead rate = Estimated total overhead / Estimated machine hours = (2500*$2.50 + 1500*$3.30 + $29,400) / 4000

= $10.15 per machine hour

Computation of manufacturing cost assigned to Job P and Q
Particulars	Job P	Job Q
Direct Material	$24,000	$13,500
Direct Labor	$29,800	$11,900
Manufacturing overhead	$45,675	$39,585
Total Manufacturing cost	$99,475	$64,985

Computation of Total price and per unit price of job
Particulars	Job P	Job Q
Manufacturing Cost	$99,475.00	$64,985.00
Markup (80%)	$79,580.00	$51,988.00
Total price of job	$179,055.00	$116,973.00
Nos of units	20	30
Selling price per unit	$8,953	$3,899

Solution 8:

Cost of goods sold = $99,475 + $64,985 = $164,460

Solution 9:

Computation of departmental overhead rates
Particulars	Molding	Fabrication
Fixed manufacturing overhead	$12,750	$16,650
Variable manufacturing overhead	$6,250	$4,950
Total manufacturing overhead	$19,000	$21,600
Nos of machine hours	2500	1500
Overhead rate per machine hour	$7.60	$14.40

Solution 10:

Computation of overhead applied from Molding department
Particulars	Job P	Job Q
Actual machine hours	2800	1900
Overhead rate	$7.60	$7.60
Overhead applied to jobs	$21,280.00	$14,440.00