Hyde Restorations rebuilds factory facilities. It employs 130 full-time workers at $25 per hour. Despite operating at capacity, last years performance was a great disappointment to the managers. In total, nine jobs were accepted and completed, incurring the following total costs:

Direct materials	$ 1,230,200
Direct labor	4,600,000
Manufacturing overhead	1,177,600

Of the $1,177,600 manufacturing overhead, 25 percent was variable overhead and 75 percent was fixed.

This year, Hyde expects to operate at the same activity level as last year, and overhead costs and the wage rate are not expected to change. For the first quarter of this year, Hyde Restorations completed two jobs and was beginning the third (Job 13). The costs incurred follow:

	Direct Materials	Direct Labor
Job 11	$ 180,360	$ 622,500
Job 12	122,900	400,500
Job 13	124,200	257,000
Total manufacturing overhead		327,440
Total marketing and administrative costs		158,800

You are a consultant associated with Conway & Company, which has been hired by Hyde to analyze the profitability issue. The managing partner on the engagement has reviewed the accounts at Hyde and suggests you start by classifying the overhead into fixed and variable components for each of the jobs. With the help of the Hyde supervisors on each of the jobs, you arrive at the following split.

	Actual Manufacturing Overhead
Variable	Fixed
Job 11	$ 37,880	$ 126,800
Job 12	35,000	107,840
Job 13	7,520	22,400
	$ 80,400	$ 257,040

In the first quarter of this year, 30 percent of marketing and administrative cost was variable and 70 percent was fixed. You are told that Jobs 11 and 12 were sold for $1,130,000 and $730,000, respectively. All over- or underapplied overhead for the quarter is written off to Cost of Goods Sold.

Required:

Present in T-accounts the actual manufacturing cost flows for the three jobs in the first quarter of this year.

Using last year's overhead costs and direct labor-hours as this year's estimate, calculate predetermined overhead rates per direct labor-hour for variable and fixed overhead.

Present in T-accounts the normal manufacturing cost flows for the three jobs in the first quarter of this year. Use the overhead rates derived in requirement (b).

Calculate operating profit (loss) for the first quarter of this year under actual and normal costing systems.