Question
11 Comans Corporation has two production departments, Milling and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each
11
Comans Corporation has two production departments, Milling and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Milling Departments predetermined overhead rate is based on machine-hours and the Customizing Departments predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates:
Milling | Customizing | |||||
Machine-hours | 16,000 | 11,000 | ||||
Direct labor-hours | 18,000 | 6,000 | ||||
Total fixed manufacturing overhead cost | $ | 92,800 | $ | 28,800 | ||
Variable manufacturing overhead per machine-hour | $ | 1.20 | ||||
Variable manufacturing overhead per direct labor-hour | $ | 5.00 | ||||
During the current month the company started and finished Job A319. The following data were recorded for this job:
Job A319: | Milling | Customizing | ||||
Machine-hours | 50 | 40 | ||||
Direct labor-hours | 60 | 30 | ||||
Direct materials | $ | 430 | $ | 180 | ||
Direct labor cost | $ | 800 | $ | 540 | ||
If the company marks up its manufacturing costs by 10% then the selling price for Job A319 would be closest to: (Round your intermediate calculations to 2 decimal places.)
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