Giannacopoulos SA uses a job-costing system at its Korinthos plant. The plant has a Machining Department and an Assembly Department. Its job-costing system has two direct-cost categories (direct materials and direct manufacturing labor) and two manufacturing overhead cost pools (the Machining Department, allocated using actual machine-hours, and the Assembly Department, allocated using actual labor cost). The 2007 budget for the plant is as follows:

Required
1. Present an overview diagram of Giannacopoulos's job-costing system. What is the budgeted overhead rate that should be used in the Machining Department? In the Assembly Department?
2. During the month of February, the cost record for Job 494 shows the following:

What is the total manufacturing overhead allocated to Job 494?
3. Balances at the end of 2007 are as follows:

Calculate the under- or over allocated manufacturing overhead for each department.

Transcribed Image Text:

Machining Department Assembly Department Manufacturing overhead Direct manufacturing labour cost Direct manufacturing labour-hours Machine-hours 1 800000 1 400000 100000 50000 3 600000 2000000 200000 200000 Machining Department Assembly Direct material used Direct manufacturing labour cost Direct manufacturing labour-hours Machine-hours 45000 14000 70000 15000 1 500 1000 1000 2000 Machining Department Assembly Department Manufacturing overhead incurred 2100000 Direct manufacturing labour cost Machine-hours 3 700000 2 200000 55000