1.ABC Company makes home office furniture from fine hardwoods. The company uses a job-order costing system and predetermined overhead rates to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Preparation Department is based on machine-hours, and the rate in the Fabrication Department is based on direct materials cost. At the beginning of the year, the company's management made the following estimates for the year:

Department

Preparation Fabrication

Machine-hour 90,000 21,000

Direct labour-hours 35,000 65,000

Direct materials cost $ 190,000 $ 450,000

Direct labour cost $280,000 $ 530,000

Manufacturing overhead cost $ 516,000 $ 820,000

Job 127 was started on April 1 and completed on May 12. The company's cost records show the following information concerning the job:

Department

Preparation Fabrication Machine-hours 350 70

Direct labour-hours 80 130

Direct material cost $850 $1,400

Direct labour cost $ 930 $ 880

Required:

a.Compute the predetermined overhead rate used during the year in the Preparation Department. Compute the rate used in the Fabrication Department.

b.Compute the total overhead cost applied to Job 127.

c.What would be the total cost recorded for Job 127?

d. If the job contained 50 units, what would be the unit product cost?