Job costing, accounting for manufacturing overhead, budgeted rates. (25-30 minutes) Giannacopoulos, SA, uses a job-costing system at its Korinthos plant. The plant has a Machining Department and a Finishing 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 actual machine-hours, and the Finishing Department, allocated using actual labour cost). The 1999 budget for the plant is as follows: lo1 

REQUIRED 1. Present an overview diagram of Giannacopoulos’s job-costing system.
2. What is the budgeted overhead rate that should be used in the Machining Department? In the Finishing Department?
3. During the month of January, the cost record for Job 431 shows the following:

What is the total manufacturing overhead allocated to Job 431?
4. Assuming that Job 431 consisted of 200 units of product, what is the unit product cost of Job 431?
5. Balances at the end of 1999 are as follows:

6. Calculate the under- or overallocated manufacturing overhead for each department and for the Korinthos plant as a whole.
Why might Giannacopoulos use two different manufacturing overhead cost pools in its job-costing system?

Transcribed Image Text:

Manufacturing overhead Direct manufacturing labour cost Direct manufacturing labour-hours Machine-hours MACHINING DEPARTMENT Dr 1,000 million Dr 90,000 million 30,000 200,000 FINISHING DEPARTMENT Dr 800 million Dr 400 million 160,000 33,000