Wilmington Company has two manufacturing departments-Assembly and Fabrication. All of its manufacturing overhead costs are fixed costs. The first set of data shown below is based on estimates from the beginning of the year. The second set of data relates to one particular job completed during the year-Job Bravo. Estimated Data Manufacturing overhead costs Direct labor-hours Machine-hours Job Bravo Direct labor-hours Machine-hours Assembly 29 21 Assembly $ 6,720,000 140,000 56,000 Fabrication 21 24 Fabrication Total $ 7,280,000 $ 14,000,000 84,000 280,000 Total 50 45 224,000 336,000 Required: 1. If Wilmington uses a plantwide predetermined overhead rate based on direct labor-hours, how much manufacturing overhead would be applied to Job Bravo? 2. If Wilmington uses departmental predetermined overhead rates with direct labor-hours as the allocation base in Assembly and machine-hours as the allocation base in Fabrication, how much manufacturing overhead would be applied to Job Bravo?

Wilmington Company has two manufacturing departments-Assembly and Fabrication. All of its manufacturing overhead costs are fixed costs. The first set of data shown below is based on estimates from the beginning of the year. The second set of data relates to one particular job completed during the year-Job Bravo. Estimated Data Manufacturing overhead costs Direct labor-hours Machine-hours Job Bravo Direct labor-hours Machine-hours Assembly 29 21 Assembly $ 6,720,000 140,000 56,000 Fabrication 21 24 Fabrication Total $ 7,280,000 $ 14,000,000 84,000 280,000 Total 50 45 224,000 336,000 Required: 1. If Wilmington uses a plantwide predetermined overhead rate based on direct labor-hours, how much manufacturing overhead would be applied to Job Bravo? 2. If Wilmington uses departmental predetermined overhead rates with direct labor-hours as the allocation base in Assembly and machine-hours as the allocation base in Fabrication, how much manufacturing overhead would be applied to Job Bravo?

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Description: Wilmington Company has two manufacturing departments-Assembly and Fabrication. All of its manufacturing overhead costs arefixed costs. The first set of data shown below is based on estimates from the beginning of the year. The second set of data rel

FINANCIAL ACCOUNTING

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Chapter1: Financial Statements And Business Decisions

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Concept explainers

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.

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Question

Wilmington Company has two manufacturing departments-Assembly and Fabrication. All of its manufacturing overhead costs are
fixed costs. The first set of data shown below is based on estimates from the beginning of the year. The second set of data relates to
one particular job completed during the year-Job Bravo.
Estimated Data
Manufacturing overhead costs
Direct labor-hours
Machine-hours
Job Bravo
Direct labor-hours
Machine-hours
Assembly
29
21
Assembly
$ 6,720,000
140,000
56,000
Fabrication
21
24
Fabrication
Total
$ 7,280,000 $14,000,000
84,000
280,000
Total
50
45
224,000
336,000
Required:
1. If Wilmington uses a plantwide predetermined overhead rate based on direct labor-hours, how much manufacturing overhead
would be applied to Job Bravo?
2. If Wilmington uses departmental predetermined overhead rates with direct labor-hours as the allocation base in Assembly and
machine-hours as the allocation base in Fabrication, how much manufacturing overhead would be applied to Job Bravo?

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