Question
Brown Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for
Brown Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on total fixed manufacturing overhead cost of $234,000, variable manufacturing overhead of $2.60 per machine-hour, and 30,000 machine-hours. The company has provided the following data concerning Job Z500 which was recently completed:
Number of units in the job | 20 |
Total machine-hours | 80 |
Direct materials | $790 |
Direct labor cost | $1,580 |
If the company marks up its unit product costs by 20% then what is the selling price for a unit in Job Z500?
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