Job Costing Review and Departmental rates - template

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York University *

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1030

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Industrial Engineering

Date

Dec 6, 2023

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xlsx

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Question 1 The following costs pertain to Job 103 at Ryan's Auto Shop: Direct Materials Quantity Price Engine Oil 14 ounces $5 per ounce Lubricant 22 ounces $8 per ounce Direct Labour 3 hours $15 per DLH MOH Costs (basaed on DLH) $8 per DLH DLH = Direct Labour Hours Calculate the total cost of job 103 $315 per ounce Question 2 The Hanson firm uses job order costing at its plant. It has a finishing department and a machining department The company uses machine hours as the cost driver to allocate manufacturing overhead in the machining Direct labour cost is used to allocate for the finishing department MOH. Estimates for the current year follow: DEPARTMENTS Machining Finishing MOH cost $500,000 $400,000 Machine Hours 20,000 hours 2,000 hours DLH 5,000 hours 22,000 hours DL Cost $150,000 $500,000 Job 311 had the following: Direct Materials Cost $12,000 $2,000 DL Cost $300 $1,200 DM DLH 10 hours 50 hours DL Machine Hours (MH) 80 hours 8 hours MOH A) Determine the two departmental cost driver rates B) Determine the total costs charged to job 311.

$70 per ounce $176 per ounce $45 per DLH department. Machining Finishing MOH $500,000 $400,000 Driver MH DL Cost Driver Base 20,000 hours $500,000 MOH Rate $25 0.8 Machining Finishing Total $12,000 $2,000 $300 $1,200

CASE The following information was reported for the most recent period. Department Molding Trimming Painting Budgeted MOH $1,656,000 $645,000 $854,000 MH Capacity 12,750 hours 2,250 hours 5,100 hours DLH Capacity 5,500 hours 9,200 hours 9,700 hours Job 400 Department Molding Trimming Painting DM $750 $25 $43 DL Costs $175 $90 $120 DLH 5 hours 2 hours 3 hours MH 5 hours 1 hours 0 hours A) Compute plant-wide MOH rate using DLH capacity as plant-wide driver and planned (budgeted) B) Compute departmental MOH rates with departmental budgeted MOH divided by the appropriat Machine hours (MH) are used for Molding department cost driver, direct labour hours (DLH) as t C) Using the job details for job 400, compare the cost of the job with the plantwide rate you calcula Department Molding Trimming Painting Budgeted MOH $1,656,000 $645,000 $854,000 Driver DLH DLH MH Capacity 12,750 hours 2,250 hours 5,100 hours DLH Capacity 5,500 hours 9,200 hours 9,700 hours $129.88 $70.11 $88.04 Department Molding Trimming Painting DM $750 $25 $43 DL Costs $175 $90 $120 DLH 5 hours 2 hours 3 hours MH 5 hours 1 hours 0 hours

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