15. The Shamrock Company manufactures automobile parts. The company uses job order costing. Since much of...
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15. The Shamrock Company manufactures automobile parts. The company uses job order costing. Since much of the work is done by machine, the company uses machine hours to charge overhead to jobs. All overhead is treated as a single cost pool. During 2021, the company only worked on two jobs. Job A required 2,000 machine hours and Job B required 1,500 machine hours. If the total overhead was $700,000 for the year, compute how much overhead cost would be charged to Job B. 16. Refer to question 15. The controller for the Shamrock Company now wants to split the overhead into four cost pools. Pool 1 is 15% of the overhead and is related to work done by computer-assisted design (CAD) and will be charged to jobs using CAD hours. Pool 2 is 25% of the overhead and is related to work done by quality engineers and will be charged to jobs using quality engineer hours. Pool 3 is 10% of the overhead and is related to direct labor and will be charged based on direct labor cost. Pool 4 is the rest of the overhead and will still be charged based on machine hours. Job A required 0 CAD hours, 300 quality engineer hours, and $200,000 in Direct Labor Cost. Job B required 800 CAD hours, 700 quality engineer hours, and $300,000 in Direct Labor Cost. Again, compute how much of the $700,000 should be charged to Job B. 15. The Shamrock Company manufactures automobile parts. The company uses job order costing. Since much of the work is done by machine, the company uses machine hours to charge overhead to jobs. All overhead is treated as a single cost pool. During 2021, the company only worked on two jobs. Job A required 2,000 machine hours and Job B required 1,500 machine hours. If the total overhead was $700,000 for the year, compute how much overhead cost would be charged to Job B. 16. Refer to question 15. The controller for the Shamrock Company now wants to split the overhead into four cost pools. Pool 1 is 15% of the overhead and is related to work done by computer-assisted design (CAD) and will be charged to jobs using CAD hours. Pool 2 is 25% of the overhead and is related to work done by quality engineers and will be charged to jobs using quality engineer hours. Pool 3 is 10% of the overhead and is related to direct labor and will be charged based on direct labor cost. Pool 4 is the rest of the overhead and will still be charged based on machine hours. Job A required 0 CAD hours, 300 quality engineer hours, and $200,000 in Direct Labor Cost. Job B required 800 CAD hours, 700 quality engineer hours, and $300,000 in Direct Labor Cost. Again, compute how much of the $700,000 should be charged to Job B.
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