Question
The Highland Corporation uses departmental overhead rates to allocate its manufacturing overhead to jobs. The company has two departments-cutting and painting. The cutting department uses
The Highland Corporation uses departmental overhead rates to allocate its manufacturing overhead to jobs. The company has two departments-cutting and painting. The cutting department uses a departmental overhead rate of $15 per machine hour, while the painting department uses a departmental overhead of $9 per direct labour hour. Job 586 used the following direct labour hours and machine hours in the two departments:
Actual results Cutting Department Painting Department
Direct labour hours used 6 5
Machine hours used 12 10
The cost for direct labour is $25 per direct labour hour and the cost of the direct materials used by job 586 is $900
Required: What was the total cost of job 586 if the Highland Corporation used the departmental overhead rates to allocate manufacturing overhead?
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