ints "Blast it!" said David Wilson, president of Teledex Company. "We've just lost the bid on the Koopers job by $3,000. It seems we're either too high to get the job or too low to make any money on half the jobs we bid." Teledex Company manufactures products to customers' specifications and operates a job order costing system. Manufacturing overhead cost is applied to jobs on the basis of direct labor cost. The following estimates were made at the beginning of the year: Department Fabricating Machining Assembly Total Plant Direct labor 213,000 $ 106,500 319,500 $639,000 Manufacturing 372,750 426,000 95,850 $894,600 overhead eBook Print $ References $ Jobs require varying amounts of work in the three departments. The Koopers job, for example, would have required manufacturing costs in the three departments as follows: Department Total Fabricating Machining Assembly Plant Direct materials $ 4,300 $ 300 $ 2,700$ 7300 Direct labor $ 5,400 $ 600 $2,500 $13,500 Manufacturing overhead ? The company uses a plantwide overhead rate to apply manufacturing overhead cost to jobs Required: 1. Assuming use of a plantwide overhead rate: 3 1. Assuming use of a plantwide overhead rate: a. Compute the rate for the current year. oints Predetermined overhead rate % of direct labor cost eBook b. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job. Print References Manufacturing overhead cost 2. Suppose that instead of using a plantwide overhead rate, the company had used a separate predetermined overhead rate in each department. Under these conditions: a. Compute the rate for each department for the current year. Predetermined Overhead Rate % Fabricating Department Machining department Assembly department % % Saved 3 b. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job. 9 points Manufacturing overhead cost eBook Print 4. Assume that it is customary in the industry to bid jobs at 150% of total manufacturing cost (direct materials, direct labor, and applied overhead). a. What was the company's bid price on the Koopers job if a plantwide overhead rate had been used to apply overhead cost? References Company's bid price b. What would the bid price have been if departmental overhead rates had been used to apply overhead cost? Company's bid price 3 9 points 5. At the end of the year, the company assembled the following actual cost data relating to all jobs worked on during the year. Department Cutting Machining Assembly Total plant Direct materials $ 203,000$ 17,300 $ 127,000 $347,300 223,000 Direct labor 121,000 275,000 619.000 922,200 Manufacturing overhead$ 383,000 $ 453,000$ 86,200 $ eBook Print a. Compute the underapplied or overapplied overhead for the year, assuming that a plantwide overhead rate is used. References overhead cost b. Compute the underapplied or overapplied overhead for the year, assuming that departmental overhead rates are used. (Enter overapplied overhead costs as negative amounts and underapplied overhead costs as positive amounts.) Fahriatin 3 Direct labor 223,000 121,000 275,000 619.000 Manufacturing overhead$ 383,000$ 453,000 $ 86,200 $ 922,200 9 points a. Compute the underapplied or overapplied overhead for the year, assuming that a plantwide overhead rate is used. eBook overhead cost Print References b. Compute the underapplied or overapplied overhead for the year, assuming that departmental overhead rates are used. (Enter overapplied overhead costs as negative amounts and underapplied overhead costs as positive amounts.) Fabricating Machining Assembly Total plant
