Required:

Using the company's plantwide approach:

a$.$ Compute the plantwide predetermined rate for the current year.

b$.$ Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.

Suppose instead of using a plantwide predetermined overhead rate, the company had used departmental predetermined overhead rates

based on direct labor cost. Under these conditions:

a$.$ Compute the predetermined overhead rate for each department for the current year.

b$.$ Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.

Explain the difference between the manufacturing overhead that would have been applied to the Koopers job using the plantwide

approach in question I$($b$)$ and usine the departmental approach in question $2($b$).$

Assume it is customary in the industry to bid jobs at $150$ of total manufacturing cost $($direct materials, direct labor, and applied

overhead$).$ What was the company's bid price on the Koopers job using a plantwide predetermined overhead rate? What would have

been the bid price if departmental predetermined overhead rates were used to apply overhead cost?"Blast it$!"$ said David Wilson, president of Teledex Company, "We've just lost the bid on the Koopers job by $$2,000.$ It seems we're either

too high to get the job or too low to make any money on halr the jobs we bid."

Teledex Company manufactures products to customers' specifications and uses a job$-$order costing system. The company uses a plantwide

predetermined overhead rate based on direct labor cost to apply its manufacturing overhead $($assumed to be all fixed$)$ to jobs. The

following estimates were made at the beginning of the year:

Jobs require varying amounts of work in the three departments. The Koopers job, for example, would have required manufacturing costs

in the three departments as follows:

Required:

Using the company's plantwide approach: