Question Number 2

Department bases its rate on direct labor-hours. At the beginning of the year, the company made the following estimates Department Cutting Finishing 67,000 1,900 $ 360,000 473,000 8,100 53,500 Direct labor-hours Machine-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour 4.00 3.75 Required: 1. Compute the predetermined overhead rate for each department. 2. The job cost sheet for Job 203, which was started and completed during the year, showed the following Department Cutting Finishing Direct labor-hours Machine-hours Direct materials Direct labor cost 13 89 750 $150 $390 $325 Using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost assigned to Job 203