Question
Deloria Corporation has two production departments, Forming and Assembly. The company uses a job-order costing system and computes a predetermined overhead rate in each production
Deloria Corporation has two production departments, Forming and Assembly. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Forming Departments predetermined overhead rate is based on machine-hours and the Assembly Departments predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates:
Forming | Assembly | |||||
Machine-hours | 19,000 | 15,000 | ||||
Direct labor-hours | 4,000 | 8,000 | ||||
Total fixed manufacturing overhead cost | $ | 129,200 | $ | 77,600 | ||
Variable manufacturing overhead per machine-hour | $ | 1.60 | ||||
Variable manufacturing overhead per direct labor-hour | $ | 3.00 | ||||
During the current month the company started and finished Job T288. The following data were recorded for this job:
Job T288: | Forming | Assembly | ||
Machine-hours | 80 | 10 | ||
Direct labor-hours | 30 | 40 | ||
Direct materials | $ | 730 | $ | 380 |
Direct labor cost | $ | 900 | $ | 1,200 |
The total amount of overhead applied in both departments to Job T288 is closest to:
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