Solomon Company uses a job costing system at its Dover, Delaware plant. The plant has a machining department. Its job costing system has two direct cost categories (direct materials and direct manufacturing labour) and two manufacturing overhead cost pools (the machining department, allocated using machine hours and the finishing department, allocated using manufacturing labour costs). The 2002 budget for the plant is: Machining Dept. Finishing Dept. Manufacturing Overhead Direct manufacturing labour cost Direct manufacturing labour hours Machine hours $10,000,000 $ 900,000 30,000 200,000 $8,000,000 $4,000,000 160,000 33,000 Machining Dept. Finishing Dept. Direct material used Direct manufacturing labour costs Direct manufacturing labour hours Machine hours $14,000 $ 600 30 130 $3,000 $1,250 50 10 What is the total manufacturing overhead allocated to job 431? a) Assuming that job 431 consisted of 20 units of product, what is the unit product cost? b) Balances at the end of 2002 are as follows: Machining Dept. Finishing Dept. Manufacturing overhead incurred Direct manufacturing labour costs Machine Hours $11,200,000 $ 950,000 220,000 $7,900,000 $4,100,000 32,000 Compute the manufacturing overhead variance for each department and for the Dover plant as a whole.
Solomon Company uses a
The 2002 budget for the plant is:
|
Machining Dept. |
Finishing Dept. |
Manufacturing Overhead Direct Direct manufacturing labour hours Machine hours
|
$10,000,000 $ 900,000 30,000 200,000 |
$8,000,000 $4,000,000 160,000 33,000 |
Machining Dept. |
Finishing Dept. |
|
Direct material used Direct manufacturing labour costs Direct manufacturing labour hours Machine hours |
$14,000 $ 600 30 130 |
$3,000 $1,250 50 10 |
What is the total manufacturing overhead allocated to job 431?
a) Assuming that job 431 consisted of 20 units of product, what is the unit product cost?
b) Balances at the end of 2002 are as follows:
Machining Dept. |
Finishing Dept. |
|
Manufacturing overhead incurred Direct manufacturing labour costs Machine Hours |
$11,200,000 $ 950,000 220,000 |
$7,900,000 $4,100,000 32,000 |
Compute the manufacturing overhead variance for each department and for the Dover plant as a whole.
Trending now
This is a popular solution!
Step by step
Solved in 4 steps