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Montana 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
Montana 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 Machine-hours required to support estimated production Fixed manufacturing overhead cost Variable manufacturing overhead cost per direct labor-hour Variable manufacturing overhead cost per machine-hour 80,000 40,000 $240,000 $ 1.80 $ 3.60 During the year, Job 550 was started and completed. The following information is available with respect to this job: Direct materials Direct labor cost Direct labor-hours Machine-hours $ 207 $ 257 15 5 Assume that Montana Corporation's controller believes that machine-hours is a better allocation base than direct labor-hours. Compute the plantwide predetermined overhead rate. $6.60 $9.60 $4.80 $6.80 Compute the total manufacturing cost of Job 550. $582 $512 $556 $536 If Montana Corp uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550? $512 $1,024 $1,536 $1,856
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