Question
Comans Corporation has two production departments, Milling and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each
Comans Corporation has two production departments, Milling and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Milling 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: Milling Customizing Machine-hours Direct labor-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour 26,000 10,000 11,000 $91,000 8,000 $44,000 $ 2.00 Variable manufacturing overhead per direct labor- $ 4.40 hour During the current month the company started and finished Job A319. The following data were recorded for this job: Job A319: Machine-hours Milling 40 Customizing 30 Direct labor-hours 30 40 Direct materials $ 400 $ 200 Direct labor cost $ 570 $ 600
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