Question 10

Rally Company manufactures garage storage systems for homeowners. It uses a normal costing system with two direct cost categories - direct materials and direct labor - an one indirect-cost pool, manufacturing overhead costs.

For 2018:

Budgeted manufacturing overhead costs $1,000,000

Budgeted manufacturing labor-hours 20,000 hours

Actual manufacturing overhead costs $1,100,000

Actual direct manufacturing labor-hours 22,000

Actual direct material costs $10,000

Actual direct manufacturing labor hours 200

Actual direct manufacturing labor rate $20 per hour

Calculate the total manufacturing costs using normal costing.