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Assume a company has two manufacturing departments - Assembly and Fabrication. The company considers all of its manufacturing overhead costs to be fixed costs.
Assume a company has two manufacturing departments - Assembly and Fabrication. The company considers all of its manufacturing overhead costs to be fixed costs. The first set of data below is budgeted data for the company as a whole that was estimated at the beginning of the year. The second set of data below is actual data for the company as a whole that was derived at the end of the year. The third set of data relates to one particular job completed during the year- Job Z. Budgeted Data Manufacturing overhead costs Assembly $ 300,000 Direct labor hours 25,000 Machine hours Actual Data Manufacturing overhead costs Direct labor hours Machine hours 10,000 Fabrication $ 400,000 Assembly $ 330,000 27,000 10,500 15,000 50,000 Fabrication $ 380,000 Fabrication 2 hours 16,000 48,000 Job Z Assembly Direct labor hours 14.50 hours Machine hours 1 hour 11.50 hours Assume the company uses departmental predetermined overhead rates. It uses direct labor-hours as the allocation base in Assembly and machine-hours as the allocation base in Fabrication. How much manufacturing overhead would be applied from both departments to Job Z?
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