Question
Sandhill Company uses a job order cost system in each of its three manufacturing departments. Manufacturing overhead is applied to jobs on the basis of
Sandhill Company uses a job order cost system in each of its three manufacturing departments. Manufacturing overhead is applied to jobs on the basis of direct labor cost in Department D, direct labor hours in Department E, and machine hours in Department K. In establishing the predetermined overhead rates for 2020, the following estimates were made for the year.
Department | ||||||
---|---|---|---|---|---|---|
D | E | K | ||||
Manufacturing overhead | $777,000 | $1,500,000 | $900,000 | |||
Direct labor costs | $1,110,000 | $1,250,000 | $450,000 | |||
Direct labor hours | 100,000 | 125,000 | 40,000 | |||
Machine hours | 400,000 | 500,000 | 120,000 |
During January, the job cost sheets showed the following costs and production data.
Department | ||||||
---|---|---|---|---|---|---|
D | E | K | ||||
Direct materials used | $140,000 | $126,000 | $78,000 | |||
Direct labor costs | $120,000 | $110,000 | $37,500 | |||
Manufacturing overhead incurred | $99,000 | $124,000 | $79,000 | |||
Direct labor hours | 8,000 | 11,000 | 3,500 | |||
Machine hours | 34,000 | 45,000 | 10,410 |
(a)
Department D | 70 | % | |
---|---|---|---|
Department E | 12 | per direct labor hour | |
Department K | 7.5 | per machine hour |
(b)
Compute the total manufacturing costs assigned to jobs in January in each department.
Manufacturing Costs
Department D $
Department E$
Department K$
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