ower Company uses a job-order cost system in each of its two manufacturing departments. Manufacturing

overhead is applied to jobs on the basis of direct labour cost in Department A and machine hours in

Department B.

In establishing the predetermined overhead rates for 2020, the following estimates were made for the year:

Department

A B

Manufacturing overhead ........................................ $1,056,000 $840,000

Direct labour cost.................................................... 264,000 600,000

Direct labour hours................................................. 12,000 40,000

Machine hours........................................................ 75,000 84,000

During January, the job cost sheet showed the following costs and production data:

Jobs

14 15

Direct materials used .............................................. $34,000 $31,000

Direct labour cost.................................................... 24,000 25,500

Manufacturing overhead incurred.......................... 65,000 35,000

Direct labour hours................................................. 2,000 1,700

Machine hours........................................................ 5,000 4,000

Instructions

a) Calculate the predetermined overhead rate for each department. (4 points)

b) Calculate the total manufacturing cost assigned to jobs 14 and 15 in January.