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Exercise 2-17 (Algo) Plantwide and Departmental Predetermined Overhead Rates; Job Costs [LO2-1, LO2-2, LO2-3, LO2-4]

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Delph Company uses job-order costing 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 $1,040,000 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	21,000	33,000	54,000
Fixed manufacturing overhead cost	$ 800,000	$ 240,000	$ 1,040,000
Variable manufacturing overhead cost per machine-hour	$ 4.00	$ 1.00

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	$ 200,000	$ 120,000	$ 320,000
Machine-hours	16,000	5,000	21,000

Job C-200	Molding	Fabrication	Total
Direct materials cost	$ 220,000	$ 240,000	$ 460,000
Direct labor cost	$ 120,000	$ 260,000	$ 380,000
Machine-hours	5,000	28,000	33,000

Delph had no underapplied or overapplied manufacturing overhead during the year.

Exercise 2-17 (Algo) Part 2

Required:

2. Assume Delph uses departmental predetermined overhead rates based on machine-hours.

1. Compute the departmental predetermined overhead rates.
2. Compute the total manufacturing cost assigned to Job D-70 and Job C-200.
3. If Delph establishes bid prices that are 150% of total manufacturing cost, what bid prices would it have established for Job D-70 and Job C-200?
4. What is Delphs cost of goods sold for the year?

Problem 2-25 (Algo) Calculating Ending Inventories and Cost of Goods Sold [LO2-5]

Expedition Company worked on five jobs during May: Jobs A10, B20, C30, D40, and E50. At the end of May, the job cost sheets for these five jobs contained the following data:

	Job A10	Job B20	Job C30	Job D40	Job E50
Beginning balance	$ 143	$ 160	$ 194	$ 156	$ 220
Charged to the jobs during May:
Direct materials	$ 180	$ 160	$ 210	$ 145	$ 290
Direct labor	$ 160	$ 170	$ 115	$ 190	$ 220
Manufacturing overhead applied	$ 187	$ 200	$ 111	$ 184	$ 230
Units completed	190	0	85	0	220
Units in process at the end of May	0	82	0	132	0
Units sold during May	0	0	85	0	170

Jobs A10, C30, and E50 were completed during May. Jobs B20 and D40 were incomplete at the end of May. There was no finished goods inventory on May 1, and the companys total manufacturing overhead applied always equals its total actual manufacturing overhead.

Required:

1. What is the cost of goods sold for May?

Note: Round "Unit product cost" to 2 decimal places and final answer to nearest dollar amount.

1. What is the total value of the finished goods inventory at the end of May?

Note: Round "Unit product cost" to 2 decimal places and final answer to nearest dollar amount.

1. What is the total value of the work in process inventory at the end of May?