High Desert Potteryworks makes a variety of pottery products that it sells to retailers. The company uses a job-order costing system in which departmental predetermined overhead rates are used to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Molding Department is based on machine-hours, and the rate in the Painting Department is based on direct labor- hours. At the beginning of the year, the company provided the following estimates: Direct labor-hours Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour Department Molding 30,500 82,000 Painting 55,400 37,000 $ 164,000 $ 2.80 $ 493,060 0 0 $ 4.80 Job 205 was started on August 1 and completed on August 10. The company's cost records show the following information concerning the job: Molding Department Painting Direct labor-hours Machine-hours 78 350 130 70 Direct materials $ 930 $ 1,240 Direct labor cost $ 700 $ 980 Required: 1. Compute the predetermined overhead rates used in the Molding Department and the Painting Department. 2. Compute the total overhead cost applied to Job 205. 3-a. What would be the total manufacturing cost recorded for Job 205? 3-b. If the job contained 25 units, what would be the unit product cost?
High Desert Potteryworks makes a variety of pottery products that it sells to retailers. The company uses a job-order costing system in which departmental predetermined overhead rates are used to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Molding Department is based on machine-hours, and the rate in the Painting Department is based on direct labor- hours. At the beginning of the year, the company provided the following estimates: Direct labor-hours Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour Department Molding 30,500 82,000 Painting 55,400 37,000 $ 164,000 $ 2.80 $ 493,060 0 0 $ 4.80 Job 205 was started on August 1 and completed on August 10. The company's cost records show the following information concerning the job: Molding Department Painting Direct labor-hours Machine-hours 78 350 130 70 Direct materials $ 930 $ 1,240 Direct labor cost $ 700 $ 980 Required: 1. Compute the predetermined overhead rates used in the Molding Department and the Painting Department. 2. Compute the total overhead cost applied to Job 205. 3-a. What would be the total manufacturing cost recorded for Job 205? 3-b. If the job contained 25 units, what would be the unit product cost?
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter2: Accounting For Materials
Section: Chapter Questions
Problem 17E: Davis Co. uses backflush costing to account for its manufacturing costs. The trigger points are the...
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