Problem 2-21 Plantwide Versus Multiple Predetermined Overhead Rates [LO2-1, LO2-2]

Mason Company has two manufacturing departmentsMachining 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

Machining

Assembly

Total

Manufacturing overhead

$

8,228,000

$

484,000

$

8,712,000

Direct labor hours

22,000

374,000

396,000

Machine hours

374,000

17,000

391,000

Job A

Machining

Assembly

Total

Direct labor hours

5

10

15

Machine hours

11

2

13

Job B

Machining

Assembly

Total

Direct labor hours

4

5

9

Machine hours

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.)

answers

1.Manufacturing overhead applied Job A$330

Manufacturing overhead applied Job B$1982

.Manufacturing overhead applied Job A$254.90

Manufacturing overhead applied Job B$270.45

QUESTION: how did they get the answer?