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Use the information below to answer the two questions that follow. A company has two manufacturing departments-Dept. A and Dept. B. At the beginning of
Use the information below to answer the two questions that follow. A company has two manufacturing departments-Dept. A and Dept. B. At the beginning of the most recent period, the company made the following estimates related to production and manufacturing overhead: Dept. A Dept. B Estimated machine-hours (MHS) 13,000 10,000 MHS Estimated direct labor hours (DLHS) 6,400 8,000 DLHs Estimated total manufacturing overhead (MOH) $252,800 $64,000 At the end of the period, results for two jobs the company started and completed were as follows: Actual direct material cost Actual direct labor cost Actual MHS - Dept. A Actual MHS - Dept. B Actual DLHS - Dept. A Actual DLHS - Dept. B Job AX3 $438 $549 105 42 56 Job AZS $514 $555 92 MHS 65 MHS 50 DLHS 49 DLHS 55 Q. The company is deciding whether to use a plant-wide predetermined overhead rate (POHR) or departmental predetermined overhead rates. If the company uses a plant-wide POHR based on direct labor hours (DLHS), the total cost of Job AX3 would be: ANS. $ a. If the company uses departmental POHRs with direct labor hours as the allocation base for the Dept. A and machine hours as the allocation base for the Dept. B, the total cost of Job AZS would be: ANS. $
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