Juarez Manufacturing uses a job order costing system. It has two departments, Machining & Assembly. Machining is heavily automated while the Assemby department is labour intensive. The company currently uses a plantwide rate based on direct labour cost. However, it is considering changing to departmental rates where the overhead rate will be based on machine hours in the machining department and direct labour hours in the assembly department. The following data is available to you: Budgeted overhead cost Actual overhead cost Budgeted direct labour cost Actual direct labour cost Budgeted machine hours. Actual machine hours Machining Assembly 2,000,000 1,540,000 2,130,000 1,525,000 750,000 2,800,000 725,000 2,890,000 200,000 212,500 50,000 55,000 You will be asked to calculate the bid price for Job DC66. The actual results for this job are: 4 Machining Assembly 12,250 13,950 180 Direct material Direct labour cost Machine hours Total actual selling and administrative expenses for the year were $2,325,000. Required: Take O/H rates to 3 decimal places. 3,350 29,300 75 1 Calculate the total product cost assuming the company uses a plantwide rate based on direct labour cost 2 Calculate the total product cost assuming the company uses departmental rates using the bases detailed at the start of the problem. 3 Calculate the amount of under/over applied overhead from part 2 Prepare the journal entry to close out the balance in the manufacturing O/H account. What would be the effect on income of this entry? 4 Assuming the company uses departmental rates and it uses a 60% markup to calculate bid prices, calculate the bid price for DC66.