Exercise 2-15 Departmental Overhead Rates [LO1, LO2, LO3]

	Department
	Milling		Assembly
Direct labor-hours		6,500		86,000
Machine-hours		53,400		3,900
Total fixed manufacturing overhead cost	$	370,000	$	488,000
Variable manufacturing overhead per machine-hour	$	2.00		-
Variable manufacturing overhead per direct labor-hour		-	$	3.75

Required:
1.

	Department
	Milling	Assembly
Predetermined overhead rate	$ per MH	$ per DLH

2.	Assume that the overhead rates you computed in (1) above are in effect. The job cost sheet for Job 407, which was started and completed during the year, showed the following:

	Department
	Milling		Assembly
Direct labor-hours		4		17
Machine-hours		84		6
Materials requisitioned	$	740	$	390
Direct labor cost	$	39	$	160

Compute the total manufacturing cost assigned to Job 407. (Round your intermediate and final answers to 2 decimal places.)

Total manufacturing cost

$

3.	Would you expect substantially different amounts of overhead cost to be charged to some jobs if the company used a plantwide overhead rate based on direct labor-hours instead of using departmental rates?