The Carlson Company uses job-costing system at its Dover, Delaware plant. The plant has a machining department and a finishing department. Carlson uses normal costing with two direct-cost categories (direct materials and direct manufacturing labor) and two manufacturing overhead cost pools (the machining department with machine-hours as the allocation base, and the finishing department with direct manufacturing labor costs as the allocation base). The 2012 budget for the plant is as follows:

Manufacturing overhead costs: Machining Department - $9,870,000/ Finishing Dept - $7,644,000

Direct manufacturing labor costs: MD - $980,000/ FD - $3,900,000

Direct manufacturing labor-hours: MD - 32,000/ FD - 170,000

Machine-hours: MD - 210,000/ FD - 33,000

1. Prepare an overview diagram of Carlson's job costing system.

2. What is the budgeted manufacturing overhead rate in the machining department? In the finishing department?

3. During the month of January, the job-cost record for JOb 431 shows the following:

Direct materials used: Machining Dept - $13,000/ FInishing Dept - $3,500

Direct manufacturing labor costs: MD - $700/ FD - $1,450

Direct manufacturing labor-hours: MD- 20/ FD- 60

Machine - hours: MD- 110/ FD- 15

Compute the total manufacturing overhead costs allocated to JOb 431.

4. Assuming that JOb 431 consisted of 100 units of product, what is the cost per unit?

5. Actual amounts atthe end of 2012 are as follows:

Manufacturing overhead incurred: MD - $11,380,000/ FD- $8,628,000

Direct manufacturing labor costs: MD - $1,030,000/ FD- $4,300,000

Machine hours: MD - 240,000/ FD- 30,000

Compute the under -or overallocated manufacturing overhead for each dept and for the DOver plant as a whole.

6. Why might Carlson use two different manufacturing overhead cost pools in its job-costing system?