Question
Bulla Corporation has two production departments, Machining and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production
Bulla Corporation has two production departments, Machining and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Machining Department's predetermined overhead rate is based on machine-hours and the Customizing Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: Machining Customizing Machine-hours 16,000 17,000 Direct labor-hours 3000 4000 Total fixed manufacturing overhead cost $ 70,400 $ 85,000 Variable manufacturing overhead per machine-hour $ 3.00 Variable manufacturing overhead per direct labor-hour $ 6.00 During the current month the company started and finished Job K369. The following data were recorded for this job: Job K369: Machining Customizing Machine-hours 70 20 Direct labor-hours 40 80 Required: Calculate the following: Predetermined OH rate for Machining (round to 2 decimal places) $ Predetermined OH rate for Customizing (round to 2 decimal places) $ Total Amount of OH applied to job K369 through both departments (do not include commas) $
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