roblem 5-50 Overhead Rates, Unit Costs Folsom Company manufactures specialty tools to customer order. There are three producing mental information on budgeted overhead and various activity measures OBJECTIVE 2 for the coming year is as follows: Welding $220,000 4,500 $90,000 5,000 Assembly Finishing Estimated overhead Direct labor hours Direct labor cost Machine hours $62,000 10,000 S150,000 1,000 150,000 6,000 $120,000 2,000 Currently, overhead is applied on the basis of machine hours using a plantwide rate. How- ever, Janine, the controller, has been wondering whether it might be worthwhile to use depart- mental overhead rates. She has analyzed the overhead costs and drivers for the various ejeartments and decided that Welding and Finishing should base their overhead rates on machine hours and that Assembly should base its overhead rate on direct labor hours. Continued) Chapter 5 Job-Order Costing Janine has been asked to prepare bids for two jobs with the following information: Job 1 Job 2 Direct materials Direct labor cost Direct labor hours $6,725$9,340 $1,800 $3,100 Welding Assembly Finishing 20 60 20 10 20 70 Number of machine hours: Welding Assembly Finishing 50 60 90 50 25 125 The typical bid price includes a 35% markup over full manufacturing cost. Round all overhead rates to the nearest cent. Round all bid prices to the nearest dollar. Required: 1. Calculate a plantwide rate for Folsom Company based on machine hours. What ishe bd price of each job using this rate? 2. Calculate departmental overhead rates for the producing departments. What is the bid price of each job using these rates