Question
Delph Company uses a job-order costing system and has two manufacturing departmentsMolding and Fabrication. The company provided the following estimates at the beginning of the
Delph Company uses a job-order costing system and has two manufacturing departmentsMolding and Fabrication. The company provided the following estimates at the beginning of the year: Molding Fabrication Total Machine-hours 25,000 35,000 60,000 Fixed manufacturing overhead costs $ 720,000 $ 280,000 $ 1,000,000 Variable manufacturing overhead cost per machine-hour $ 5.70 $ 5.70 During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobsJob D-70 and Job C-200. It provided the following information related to those two jobs: Job D-70: Molding Fabrication Total Direct materials cost $ 374,000 $ 325,000 $ 699,000 Direct labor cost $ 230,000 $ 160,000 $ 390,000 Machine-hours 17,000 8,000 25,000 Job C-200: Molding Fabrication Total Direct materials cost $ 230,000 $ 260,000 $ 490,000 Direct labor cost $ 110,000 $ 220,000 $ 330,000 Machine-hours 8,000 27,000 35,000 Delph had no underapplied or overapplied manufacturing overhead during the year. 2. Assume Delph uses departmental predetermined overhead rates based on machine-hours. a. Compute the departmental predetermined overhead rates. b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200. c. If Delph establishes bid prices that are 140% of total manufacturing costs, what bid prices would it have established for Job D-70 and Job C-200? d. What is Delphs cost of goods sold for the year?
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