URGENT

Mason Engineering manufactures audio devices for cars and uses job order costing. There are two departments. In Department A, overhead is applied on the basis of machine-hours, and in Department B, on the basis of direct labor hours. At the start of the current year, the following budget estimates were developed in order to compute the overhead application rates:

	Department A	Department B
Direct labor	$420,000	$300,000
Manufacturing overhead	$540,000	$412,500
Machine-hours	19,000	2,000
Direct labor hours	26,000	24,000

4,000 Audio circuit modules (Job no. 100) were produced in January. The cost records for the job show the following information:

Job no. 100 (4,000 units of product):	Department A	Department B
Cost of materials used on job	$6,800	$4,500
Direct labor cost	$8,100	$7,200
Direct labor hours	540	600
Machine-hours	250	100

a. Compute the overhead rate that should be used for each department in applying overhead costs to Job no. 100. [2 Marks]

b. What is the total cost of Job no. 100, and what is the unit cost of the product manufactured on

this production order? [3 + 3 Marks]

c. If the actual overhead costs and actual machine hours for the year were as given in the table, determine the over- or underapplied overhead in each department for the year. [2 Marks]

	Actual overhead ($)	Actual machine hours
Department A	517,000	17,000
Department B	424,400	26,000