EXERCISE 2-15 Plantwide and Departmental Predetermined Overhead Rates; Job Costs LO2-1. LO2-2, LO2-3, LO2-4 Delph Company uses a job-order costing system and has two manufacturing departments-Molding and Fabrication. The company provided the following estimates at the beginning of the year: Molding Fabrication Total Machine-hours 20,000 30,000 50,000 Fixed manufacturing overhead cost $210,000 $910,000 $700,000 $3.00 Variable manufacturing overhead cost per machine-hour $1.00 During the year, the company had no beginning or ending inventories and it started, com- pleted, and sold only two jobs-Job 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 Direct labor cost $375,000 $325,000 $700,000 $200,000 $160,000 $360,000 14,000 Machine-hours 6,000 20,000 Job C-200 Molding Fabrication Total Direct materials cost $300,000 $250,000 $550,000 Direct labor cost $400,000 $175,000 $225,000 6,000 Machine-hours 24,000 30,000 Delph had no underapplied or overapplied manufacturing overhead during the year. Required: 1. Assume Delph uses a plantwide predetermined overhead rate based on machine-hours. a. Compute the plantwide predetermined overhead rate. b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200 Chapter 2 c. If Delph establishes bid prices that are 150% of total manufacturing cost, what bid prices would it have established for Job D-70 and Job C-200? d. What is Delph's cost of goods sold for 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 150% of total manufacturing costs, what bid prices would it have established for Job D-70 and Job C-200? d. What is Delph's cost of goods sold for the year? 3. What managerial insights are revealed by the computations that you performed in this prob- lem? (Hint: Do the cost of goods sold amounts that you computed in requirements 1 and 2 differ from one another? Do the bid prices that you computed in requirements 1 and 2 differ from one another? Why?)