Molding Fabrication Total Machine-hours 20,000 30,000 50,000 $700,000 $3.00 $210,000 $1.00 Fixed manufacturing overhead cost $910,000 Variable manufacturing overhead cost per machine-hour .... During the year, the company had no beginning or ending inventories and it started, com- pleted, and sold only two jobs Job D-70 and Job C-200. It provided the following information related to those two jobs: Job D-70 Molding Fabrication Total $375,000 $200,000 $325,000 $160,000 $700,000 $360,000 Direct materials cost Direct labor cost Machine-hours 14,000 6,000 20,000 Job C-200 Molding Fabrication Total $300,000 $175,000 $250,000 $225,000 $550,000 $400,000 Direct materials cost Direct labor cost . Machine-hours 6,000 24,000 30,000 Delph had no underapplied or overapplied manufacturing overhead during the year.
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Delph Company uses a
Required:
1. Assume Delph uses a plantwide predetermined
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 cost, 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?
2. Assume Delph uses departmental predetermined overhead rates based on machine-hours.
a. Compute the departmental predetermined overhead rates.
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
d. What is Delph’s cost of goods sold for the year?
3. What managerial insights are revealed by the computations that you performed in this problem? (Hint: Do the cost of goods sold amounts that you computed in requirements 1 and 2 differ from one another? Do the bid prices that you computed in requirements 1 and 2 differ from one another? Why?)
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