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Explain please Delph Company uses a job-order costing system with a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, the
Explain please
Delph Company uses a job-order costing system with a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, the company estimated that 54,000 machine-hours would be required for the period's estimated level of production. It also estimated $1,000,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $5.00 per machine hour. Because Delph has two manufacturing departments-Molding and Fabricationit is considering replacing its plantwide overhead rate with departmental rates that would also be based on machine-hours. The company gathered the following information to enable calculating departmental overhead rates: Molding Fabrication Total Machine-hours 21,000 33,00 54,000 Fixed manufacturing overhead cost $ 760,000 $ 240,000 $ 1,000,000 Variable manufacturing overhead cost per machine-hour $ 5.00 During the year, the company had no beginning or ending inventories and it started, completed, 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 $ 370,000 $ 320,000 $ 690,000 Direct labor cost $ 240,000 $ 160,000 $ 400,000 Machine-hours 16,000 5,000 21,000 $ 1.5e Job (-200 Direct materials cost Direct labor cost Machine-hours Molding $ 280,000 $ 160,000 5,000 Fabrication $ 240,000 $ 240,000 28,000 Total $ 520,000 $ 400,000 33,000 Delph had no underapplied or overapplied manufacturing overhead during the year. Required: 1. Assume Delph uses plantwide predetermined overhead rates 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. 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 Step by Step Solution
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