Question
Required information Exercise 2-15 (Algo) Plantwide and Departmental Predetermined Overhead Rates; Job Costs [LO2-1, LO2-2, LO2-3, LO2-4] Skip to question [The following information applies to
Required information Exercise 2-15 (Algo) Plantwide and Departmental Predetermined Overhead Rates; Job Costs [LO2-1, LO2-2, LO2-3, LO2-4] Skip to question [The following information applies to the questions displayed below.] Delph Company uses a job-order costing system with a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, the company estimated that 54,000 machine-hours would be required for the periods estimated level of production. It also estimated $960,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $4.00 per machine-hour. Because Delph has two manufacturing departmentsMolding and Fabricationit is considering replacing its plantwide overhead rate with departmental rates that would also be based on machine-hours. The company gathered the following information to enable calculating departmental overhead rates: Molding Fabrication Total Machine-hours 20,000 34,000 54,000 Fixed manufacturing overhead cost $ 740,000 $ 220,000 $ 960,000 Variable manufacturing overhead cost per machine-hour $ 4.00 $ 2.00 During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobsJob D-70 and Job C-200. It provided the following information related to those two jobs: Job D-70 Molding Fabrication Total Direct materials cost $ 370,000 $ 320,000 $ 690,000 Direct labor cost $ 240,000 $ 120,000 $ 360,000 Machine-hours 14,000 6,000 20,000 Job C-200 Molding Fabrication Total Direct materials cost $ 300,000 $ 220,000 $ 520,000 Direct labor cost $ 140,000 $ 260,000 $ 400,000 Machine-hours 6,000 28,000 34,000 Delph had no underapplied or overapplied manufacturing overhead during the year. Exercise 2-15 (Algo) Part 1 Required: 1. Assume Delph uses plantwide predetermined overhead rates based on machine-hours. a. Compute the plantwide predetermined overhead rate. b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200. c. If Delph establishes bid prices that are 150% of total manufacturing costs, what bid prices would it have established for Job D-70 and Job C-200? d. What is Delphs cost of goods sold for the year?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started