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Job 123 requires $12,000 of direct materials, $5,500 of direct labor, 500 direct labor hours, and 300 machine hours. It also requires 6 hours of
Job 123 requires $12,000 of direct materials, $5,500 of direct labor, 500 direct labor hours, and 300 machine hours. It also requires 6 hours of inspection at $40 per hour. Manufacturing overhead is computed at $30 per direct labor hour used and $40 per machine hour used. The total amount charged for inspection A. is $40 x budgeted hours. O B. is $240. O c. is $40. O D. does not figure into the total cost of the job. Cooper's Bags Company manufactures cloth grocery bags to be sold to grocery stores and other retailers. Cooper's Bags Company sells the bags in cases of 1,800 bags. The bags come in three sizes: Large, Medium, and Small. Currently, Cooper's Bags Company uses a single plantwide overhead rate to allocate its $8,741,000 of annual manufacturing overhead. Of this amount, $2,250,000 is associated with the Large Bag line, $3,411,000 is associated with the Medium Bag line, and $3,080,000 is associated with the Small Bag line. Cooper's Bags Company is currently running a total of 39,000 machine hours: 12,800 in the Large Bag line, 14,600 in the Medium Bag line, and 11,600 in the Small Bag line. Cooper's Bags Company uses machine hours as the cost driver for manufacturing overhead costs. Which product line(s) have been overcosted or undercosted by using the plantwide manufacturing overhead rate? O A. Large, Medium, and Small Bags have all been undercosted. O B. Large Bags has been overcosted; Medium and Small have been undercosted. O C. Large Bags has been undercosted; Medium and Small have been overcosted. OD. Large, Medium, and Small Bags have all been overcosted
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