Fortis Manufacturing is a custom engine manufacturer that uses a Normal job costing system. It has decided to use machine-hours as the single indirect-cost rate to allocate manufacturing overhead costs to the various jobs contracted during the year. The following information is provided:

	Annual		Actual
	Budget		Job #500
Direct materials	$ 320,000		$ 1,800
Direct manufacturing labour	$ 120,000		$ 650
Manufacturing overhead (MOH)	$ 600,000
Machine hours	200,000		450
Labour hours	6,000		33

Required (show all calculations):

a. Determine the total manufacturing costs for Job #500. (4 marks)

b. Briefly explain why companies use Normal costing systems instead of Actual costing systems. (2 marks)