Question
Required information Skip to question [The following information applies to the questions displayed below.] The Gilster Company, a machine tooling firm, has several plants. One
Required information Skip to question [The following information applies to the questions displayed below.] The Gilster Company, a machine tooling firm, has several plants. One plant, located in St. Cloud, Minnesota, uses a job order costing system for its batch production processes. The St. Cloud plant has two departments through which most jobs pass. Plant-wide overhead, which includes the plant managers salary, accounting personnel, cafeteria, and human resources, is budgeted at $300,000. During the past year, actual plantwide overhead was $286,000. Each departments overhead consists primarily of depreciation and other machine-related expenses. Selected budgeted and actual data from the St. Cloud plant for the past year are as follows. Department A Department B Budgeted department overhead (excludes plantwide overhead) $ 151,200 $ 540,000 Actual department overhead 170,000 560,000 Expected total activity: Direct labor hours 34,000 20,000 Machine-hours 18,000 45,000 Actual activity: Direct labor hours 36,500 18,800 Machine-hours 18,800 47,000 For the coming year, the accountants at the St. Cloud plant are in the process of helping the sales force create bids for several jobs. Projected data pertaining only to job no. 110 are as follows. Direct materials $ 24,000 Direct labor cost: Department A (2,600 hr) 39,000 Department B (1,500 hr) 12,400 Machine-hours projected: Department A 150 Department B 1,200 Units produced 7,000
Required: a-1. Assume the St. Cloud plant uses a single plantwide overhead rate to assign all overhead (plantwide and department) costs to jobs. Use expected total direct labor hours to compute the overhead rate. a-2. What is the expected cost per unit produced for job no. 110?
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