Question
Problem 2-21 Plantwide Versus Multiple Predetermined Overhead Rates [LO2-1, LO2-2] Mason Company has two manufacturing departments-Machining and Assembly. The company considers all of its
Problem 2-21 Plantwide Versus Multiple Predetermined Overhead Rates [LO2-1, LO2-2] Mason Company has two manufacturing departments-Machining and Assembly. The company considers all of its manufacturing overhead costs to be fixed costs. It provided the following estimates at the beginning of the year as well as the following information with respect to Jobs A and B: Estimated Data Manufacturing overhead Direct labor hours Machine hours Machining $1,008,000 Assembly $144,000 Total $1,152,000 12,000 84,000 84,000 7,000 96,000 91,000 Job A Machining Assembly Total Direct labor hours Machine hours 5 10 15 11 2 13 Job B Machining Assembly Total Direct labor hours. Machine hours 4 5 9 12 3 15 Required: 1. If Mason Company uses a plantwide predetermined overhead rate with direct labor-hours as the allocation base, how much manufacturing overhead cost would be applied to Job A? Job B? (Round your answers to the nearest whole dollar amount.) 2. Assume that Mason Company uses departmental predetermined overhead rates. The Machining Department is allocated based on machine-hours and the Assembly Department is allocated based on direct labor-hours. How much manufacturing overhead cost would be applied to Job A? Job B? (Round your intermediate calculations and final answers to 2 decimal places.)
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