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At the beginning of the year, the company estimated that 54,000 machine-hours would be required for the period's estimated level of production. It also
At the beginning of the year, the company estimated that 54,000 machine-hours would be required for the period's estimated level of production. It also estimated $1,060,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $4.00 per machine-hour. Because Delph has two manufacturing departments-Molding and Fabricationit is considering replacing its plantwide overhead rate with departmental rates that would also be based on machine-hours. The company gathered the following information to enable calculating departmental overhead rates: Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead cost per machine-hour Molding 22,000 $ 780,000 $ 4.00 Fabrication 32,000 $ 280,000 $ 1.00 Total 54,000 $ 1,060,000 During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobs- Job D-70 and Job C-200. It provided the following information related to those two jobs: Job D-70 Direct materials cost Direct labor cost Machine-hours Molding $ 370,000 $ 220,000 15,000 Fabrication $ 320,000 $ 120,000 7,000 Job C-200 Molding Direct materials cost $ 280,000 Direct labor cost Machine-hours $ 140,000 7,000 $ 260,000 $ 260,000 25,000 Fabrication Total $ 690,000 $ 340,000 22,000 Total $ 540,000 $ 400,000 32,000 Delph had no underapplied or overapplied manufacturing overhead during the year. Exercise 3-17 (Algo) Part 1 Required: 1. Assume Delph uses plantwide predetermined overhead rates based on machine-hours. a. Compute the plantwide predetermined overhead rate. b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200.
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