Job costing The Gonzalez Company uses a job order costing system at its Green Bay, Wisconsin, plant. The plant has a machining department and a finishing department. The company uses two cost driver rates for allocating manufacturing support costs to job orders: one on the basis of machine hours for allocating machining department support costs and the other on the basis of direct labor cost for allocating the finishing department support costs. Estimates for 2000 follow:

REQUIRED

(a) Determine the two departmental cost driver rates.

(b) During the month of January 2000, cost records for Job 134 show the following:

Determine the total costs charged to Job 134 in January 2000.

(c) Explain why Gonzalez Company uses two different cost driver rates in its job costing system.

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Manufacturing support cost Machine hours Direct labor hours Direct labor cost MACHINING DEPARTMENT FINISHING DEPARTMENT $500,000 20,000 5,000 $150,000 $400,000 2,000 22,000 $500,000