Landen Corporation uses a job-order costing system. At the beginning of the year, the company made the following estimates:

Direct labor-hours required to support estimated production	65,000
Machine-hours required to support estimated production	32,500
Fixed manufacturing overhead cost	$ 195,000
Variable manufacturing overhead cost per direct labor-hour	$ 1.20
Variable manufacturing overhead cost per machine-hour	$ 2.40

During the year, Job 550 was started and completed. The following information is available with respect to this job:

Direct materials	$ 250
Direct labor cost	$ 318
Direct labor-hours	15
Machine-hours	5

Required:

1. Assume that Landen has historically used a plantwide predetermined overhead rate with direct labor-hours as the allocation base. Under this approach:

a. Compute the plantwide predetermined overhead rate.

b. Compute the total manufacturing cost of Job 550.

c. If Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550?

2. Assume that Landens controller believes that machine-hours is a better allocation base than direct labor-hours. Under this approach:

a. Compute the plantwide predetermined overhead rate.

b. Compute the total manufacturing cost of Job 550.

c. If Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550?

1. Direct labor-hours:
1a. Predetermined overhead rate		per DLH
1b. Total manufacturing cost of Job 550
1c. Selling price
2. Machine-hours:
2a. Predetermined overhead rate		per MH
2b. Total manufacturing cost of Job 550
2c. Selling price