The following information relates to a company that has two manufacturing departments. The company used the following dat. beginning of the period to calculate predetermined overhead rates: Estimated total machine-hours (MHs) Estimated total fixed manufacturing overhead cost Estimsted variable manufacturing overhead cost per MH Dept. x 6,000 $36,600 $ 2.00 Dept. 4,000 $24,400 $ 4.00 Total 10,000 $61,000 During the period, the company started and completed two jobs-Job A and Job B. Data concerning those two jobs follow. Job A Direct materials Direct labor cost Molding machine-hours Assembly machine-hours Job B $21,400 $8,400 $21,600 $8,400 3,300 3,600 2,700 400 Required: 1. Assume the company uses a plantwide predetermined manufacturing overead rate based on machine hours
The following information relates to a company that has two manufacturing departments. The company used the following dat. beginning of the period to calculate predetermined overhead rates: Estimated total machine-hours (MHs) Estimated total fixed manufacturing overhead cost Estimsted variable manufacturing overhead cost per MH Dept. x 6,000 $36,600 $ 2.00 Dept. 4,000 $24,400 $ 4.00 Total 10,000 $61,000 During the period, the company started and completed two jobs-Job A and Job B. Data concerning those two jobs follow. Job A Direct materials Direct labor cost Molding machine-hours Assembly machine-hours Job B $21,400 $8,400 $21,600 $8,400 3,300 3,600 2,700 400 Required: 1. Assume the company uses a plantwide predetermined manufacturing overead rate based on machine hours
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![The following information relates to a company that has two manufacturing departments. The company used the following data
beginning of the period to calculate predetermined overhead rates:
Estimated total machine-hours (MHs)
Estimated total fixed manufacturing overhead cost
Estimated variable manufacturing overhead cost per MH
Dept. X
6,000
$36,600
$ 2.00
Dept. Y
4,000
$24,400
$ 4.00
Total
10,000
$61,000
During the period, the company started and completed two jobs-Job A and Job B. Data concerning those two jobs follow
Job B
$21,400 $ 8,400
$21,600 $8,400
3,300
3,600
Job A
Direct materials
Direct lebor cost
Molding machine-hours
Assembly machine-hours
2,700
400
Required:
1. Assume the company uses a plantwide predetemined manufacturing overfead rate based on machine hours.
a. Calculate the overhead rate (Round your answer to 2 decimal places.)
b. Calculate the amount of manufacturing overhead applied to Job A. (Do not round intermediate calculations.)
c. Calculate the total manufacturing cost assigned to Job A (Do not round intermediate calculations.)
d. The company uses a markup of 20% on manufacturing cost to establish selling prices. Calculate the selling price for Job A.
not round intermediate calculations.)
2. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in bot
departments
2. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in t
departments.
a. Calculate the predetermined overhead rate for the Dept. X. (Round your answer to 2 decimal places.)
b. Calculate the departmental predetermined overhead rate for Dept. Y. (Round your answer to 2 decimal places.)
c. Calculate the total manufacturing overhead applied to Job A. (Do not round intermediate calculations.)
d. The company uses a markup of 20% on manufacturing cost to establish selling prices. Calculate the selling price for Job
not round intermediate calculations.)
1a Plantwide predetermined overhead rate
1b Manufacturing overhead applied to Job A
1c Total manufacturing cost of Job A
1d. Selling price of Job A
2a Dept X predetermined overhead rate
2b. Dept Y predetermined overhead rate
2c Manufacturing overhead applied to Job A
2d. Selling price of Job A
per MH
per MH
per MH](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3ed7b108-75f7-4ad6-b575-cd9d86013b69%2F412688c6-c167-4ce6-ad75-cfd33f735997%2F2gjqxki_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The following information relates to a company that has two manufacturing departments. The company used the following data
beginning of the period to calculate predetermined overhead rates:
Estimated total machine-hours (MHs)
Estimated total fixed manufacturing overhead cost
Estimated variable manufacturing overhead cost per MH
Dept. X
6,000
$36,600
$ 2.00
Dept. Y
4,000
$24,400
$ 4.00
Total
10,000
$61,000
During the period, the company started and completed two jobs-Job A and Job B. Data concerning those two jobs follow
Job B
$21,400 $ 8,400
$21,600 $8,400
3,300
3,600
Job A
Direct materials
Direct lebor cost
Molding machine-hours
Assembly machine-hours
2,700
400
Required:
1. Assume the company uses a plantwide predetemined manufacturing overfead rate based on machine hours.
a. Calculate the overhead rate (Round your answer to 2 decimal places.)
b. Calculate the amount of manufacturing overhead applied to Job A. (Do not round intermediate calculations.)
c. Calculate the total manufacturing cost assigned to Job A (Do not round intermediate calculations.)
d. The company uses a markup of 20% on manufacturing cost to establish selling prices. Calculate the selling price for Job A.
not round intermediate calculations.)
2. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in bot
departments
2. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in t
departments.
a. Calculate the predetermined overhead rate for the Dept. X. (Round your answer to 2 decimal places.)
b. Calculate the departmental predetermined overhead rate for Dept. Y. (Round your answer to 2 decimal places.)
c. Calculate the total manufacturing overhead applied to Job A. (Do not round intermediate calculations.)
d. The company uses a markup of 20% on manufacturing cost to establish selling prices. Calculate the selling price for Job
not round intermediate calculations.)
1a Plantwide predetermined overhead rate
1b Manufacturing overhead applied to Job A
1c Total manufacturing cost of Job A
1d. Selling price of Job A
2a Dept X predetermined overhead rate
2b. Dept Y predetermined overhead rate
2c Manufacturing overhead applied to Job A
2d. Selling price of Job A
per MH
per MH
per MH
![1a Plantwide predetermined overhead rate
per MH
1b. Manufacturing overhead applied to Job A
1c Total manufacturing cost of Job A
1d. Selling price of Job A
2a Dept. X predetermined overhead rate
2b. Dept. Y predetermined overhead rate
2c Manufacturing overhead applied to Job A
2d. Selling price of Job A
per MH
per MH
3. Do you recommend the company use a plantwide rate or departmental rates to apply overhead? Why?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3ed7b108-75f7-4ad6-b575-cd9d86013b69%2F412688c6-c167-4ce6-ad75-cfd33f735997%2F5xcvi2e_processed.jpeg&w=3840&q=75)
Transcribed Image Text:1a Plantwide predetermined overhead rate
per MH
1b. Manufacturing overhead applied to Job A
1c Total manufacturing cost of Job A
1d. Selling price of Job A
2a Dept. X predetermined overhead rate
2b. Dept. Y predetermined overhead rate
2c Manufacturing overhead applied to Job A
2d. Selling price of Job A
per MH
per MH
3. Do you recommend the company use a plantwide rate or departmental rates to apply overhead? Why?
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