Scorpio makes premium bikes using two departments, assembly and painting. Assembly estimates using 868,000 machine hours and painting uses 41,000 machine hours. Fixed manufacturing overhead costs are estimated to be $10,000,000 for assembly and $751,000 for painting. Variable manufacturing overhead per machine hour is $11.5 in both departments. Machine hours are used as the allocation base for a plantwide predetermined manufacturing overhead application rate. A bike dealership shop places an order for 20 bikes. The order requires 1,030 machine hours in assembly and 105 machine hours in painting. The job also requires $54,000 of direct materials and $108,000 of direct labor. What is the unit product cost (per bike) for the job when Scorpio uses a plantwide approach to calculating its predetermined manufacturing overhead application rate? Round your answer to 2 d.p. Do not round intermediary calculations.
Scorpio makes premium bikes using two departments, assembly and painting.
Assembly estimates using 868,000 machine hours and painting uses 41,000 machine hours. Fixed
A bike dealership shop places an order for 20 bikes. The order requires 1,030 machine hours in assembly and 105 machine hours in painting. The job also requires $54,000 of direct materials and $108,000 of direct labor.
What is the unit product cost (per bike) for the job when Scorpio uses a plantwide approach to calculating its predetermined manufacturing overhead application rate?
Round your answer to 2 d.p. Do not round intermediary calculations.
job order costing is a valuable tool for businesses that produce unique, customized, or complex products or services. It allows businesses to accurately track costs, make informed decisions, and improve overall cost control and inventory management.
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