Lucas Industries uses departmental overhead rates to allocate its manufacturing overhead to jobs. The company has two departments: Assembly and Sanding. The Assembly Department uses a departmental overhead rate of $60 per machine hour, while the Sanding Department uses a departmental overhead rate of $30 per direct labor hour. Job 603 used the following direct labor hours and machine hours in the two departments:Actual resultsAssemblyDepartmentSandingDepartmentDirect labor hours used96Machine hours used97The cost for direct labor is $35 per direct labor hour and the cost of the direct materials used by Job 542 is $1500.What was the total cost of Job 542 ifLucas Industries used the departmental overhead rates to allocate manufacturing overhead? Question 2 options: $2820 $2745 $2060 $2025

Formula: Total cost = Direct materials + Direct labor + Manufacturing overhead.

Answered: Lucas Industries uses departmental…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Lucas Industries uses departmental overhead rates to allocate its manufacturing overhead to jobs. The company has two departments: Assembly and Sanding. The Assembly Department uses a departmental overhead rate of $60 per machine hour, while the Sanding Department uses a departmental overhead rate of $30 per direct labor hour. Job 603 used the following direct labor hours and machine hours in the two departments:

Actual results	Assembly Department	Sanding Department
Direct labor hours used	9	6
Machine hours used	9	7

The cost for direct labor is $35 per direct labor hour and the cost of the direct materials used by Job 542 is $1500.

What was the total cost of Job 542 ifLucas Industries used the departmental overhead rates to allocate manufacturing overhead?

Question 2 options: