EXHIBIT 2 - 5 Dickson Company: An Example Using Multiple Predetermined Overhead Rates Step 1: Calculate the estimated total manufacturing overhead cost for each department. Milling Department Overhead Cost (Y)= $390,000 + ($2.00 per MH x 60,000 MHS) = $390,000+ $120,000 = $510,000 Assembly Department Overhead Cost (Y) = $500,000 + ($3.75 per DLH x 80,000 DLHS) = $500,000 + $300,000 = $800,000 Step 2: Calculate the predetermined overhead rate in each department. Milling Department Overhead Rate = $510,000/60,000 machine-hours = $8.50 per machine-hour Assembly Department Overhead Rate = $800,000/80,000 direct labor-hours = $10.00 per direct labor-hour Step 3: Calculate the amount of overhead applied from both departments to Job 407. Milling Department: Overhead Applied to Job 407 = $8.50 per MH 90 MHs = $765 Assembly Department: Overhead Applied to Job 407 = $10.00 per DLH ~ 20 DLHS = $200 Step 4: Calculate the total job cost for Job 407. Direct materials Direct labor Manufacturing overhead applied Total cost of Job 407 Milling $ 800 $ 70 $ 765 Assembly $ 370 $ 280 $ 200 Total $ 1,170 350 965 $ 2,485 Step 5: Calculate the selling price for Job 407. Total cost of Job 407 Markup ($2,485 x 75%) Selling price of Job 407 $ 2,485.00 1,863.75 $ 4,348.75 22 Required information This Excel worksheet relates to the Dickson Company example that is summarized in Exhibit 2.5 Part 2 of 2 points 2. Change the total fed manufacturing overhead cost for the Miling Department in Data area back to $390,000, keeping all of the other data the same as in the original example. Consider a new job, Job 408, with the following characteristics: A B look Print -NON 1 Chapter 2: Applying Excel 2 3 Cest summary for Job 408 4 Machine hours 5 Direct labor-hours 6 Direct materials cost 7 Direct labor cost 8 Department Assembly 30 5 Herences $ 5 780 S 90 5 250 430 In your worksheet, enter this new data in the cells for Job 407. What is the new selling price for Job 408? (Round your final answer to 2 decimal places.) Selling price for Job & 3. Without changing the data for the job from requirement 2 above, what is the selling price for Job 408 If the total number of machine hours in the Assembly Department increases from 3.000 machine hours to 6.000 machine houts? (Round your final answer to 2 decimal places.) Selling price for Job 408 4. Restore the total number of machine hours in the Assembly Department to 3,000 machine hours. And keep the job data the same as it was in Requirement 2. What is the selling price for Job 408 If the total number of direct labor hours in the Assembly Department decreases from 80,000 direct labor hours to 50,000 direct labor hours? (Round your final answer to 2 decimal places.) Selling price for Job 40B