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The job costing system at Shirley's Custom Framing has five indirect cost pools (purchasing, material handling, machine maintenance, product inspection, and packaging). The company is
The job costing system at Shirley's Custom Framing has five indirect cost pools (purchasing, material handling, machine maintenance, product inspection, and packaging). The company is in the process of bidding on two jobs; Job 215, an order of 17 intricate personalized frames, and Job 325, an order of 6 standard personalized frames. The controller wants you to compare overhead allocated under the current simple job-costing system and a newly designed activity-based job-costing system. Total budgeted costs in each indirect cost pool and the budgeted quantity of activity driver are as follows. E: (Click the icon to view the cost and driver data.) i (Click the icon to view the job data.) Read the requirements. Requirement 1. Compute the total overhead allocated to each job under a simple costing system, where overhead is allocated based on machine-hours. (Round interim and final answers to the nearest cent.) Job 215 Indirect cost allocated - simple costing system Budgeted Quantity of Activity Driver Activity Driver Purchased orders processed Material moves Purchasing Material handling Machine maintenance Product inspection Budgeted Overhead 28,600 29,400 120,000 8,000 7,400 2,200 4,900 10,000 1,600 Machine-hours Inspections Packaging Units produced 3,700 193,400 Information related to Job 215 and Job 325 follows. Job 215 incurs more batch-level costs because it uses more types of materials that need to be purchased, moved, and inspected relative to Job 325. Job 215 Job 325 Number of purchase orders Number of material moves Machine-hours Number of inspections Units produced
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