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Cost accumulation in two departments Country Products manufactures quilt racks. Pine stock is introduced in Department 1, where the raw material is cut and assembled.

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Cost accumulation in two departments Country Products manufactures quilt racks. Pine stock is introduced in Department 1, where the raw material is cut and assembled. In Department 2, completed racks are stained and packaged for shipment. Department 1 applies overhead on the basis of machine hours; Department 2 applies overhead on the basis of direct labor hours. The company's predetermined overhead rates were computed using the following information: Sue Power contacted Country Products to produce 900 quilt racks as a special order. Power wanted the racks made from teak and to be made larger than the company's normal racks. Country Products designated Power's order as Job \#462. During July, Country Products purchased $622,800 of raw material on account, of which $34,200 was teak. Requistions were issued for $612,000 of raw material, including all the teak. There were 513 direct labor hours worked (at a rate of $11 per DLH) and 4,320 machine hours recorded in Department 1; of these hours, 45 DLHs and 576 MHs were on Job\#462. Department 2 had 2,574 DLHs (at a rate of $18 per DLH) and 324MHs; of these, 284DLHs and 36MHs were worked on Job \#462. Assume that all wages are paid in cash. Job \#462 was completed on July 28 and shipped to Power. She was billed cost plus 20 percent. a. What are the predetermined overhead rates for Departments 1 and 2? c. What were the cost and selling price per unit of Job \#462? What was the cost per unit of the raw material? Note: Round your answers to two decimal places. d. Assume that enough pine had been issued in July for 36,000 quilt racks. The raw material inventory manager is Power's friend, who conveniently "forgot" to trace the teak's cost specifically to job \#462. What would the effect of this "error" be on the raw material cost, total cost, and selling price for each unit in Job \#462? Note: Round your answers to two decimal places

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