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Using a job order costing system, Pentucket Computer Company estimated the total Click the icon to view the ABC information.) cost of two jobs as
Using a job order costing system, Pentucket Computer Company estimated the total Click the icon to view the ABC information.) cost of two jobs as follows: (Click the icon to view the estimates under job costing.) Click the icon to view the records for two clients.) Pentucket Computer Company is now considering using an ABC system. Read the requirements Information about ABC costs and records for the same two jobs for 2020 follow: Requirement 1. Compute the total cost for each job using activity-based costing (ABC). The cost of direct labor is $18 per hour. Activity-based costing: Job 721 Job 722 Direct costs Indirect costs: Total costs Standard costing (single plantwide rate): Job 721 Job 722 Direct materials Direct labor* $ 2,400 21,500 $ 13,860 2,079 Manufacturing overhead** 1,620 243 Total cost $ 37,439 $ 4,263 Direct labor calculated as follows: Hours per job 770 Job 721 Direct labor cost per hour 18 Total direct labor costs per job 13,860 X 11 Job 722 90 $ $ 18 1,620 Manufacturing overhead calculated as follows: Predetermined OH allocation rate Total direct labor costs per job 13,860 1,620 Manufacturing OH allocated II Job 721 X $ $ 15% = Job 722 $ $ 2,079 X 15% Il 243 - X i Data Table Activity Predetermined Overhead Allocation Rate $ 0.50 Assembly Programming Testing Allocation Base Number of parts Number of direct labor hours Number of tests 7.00 160.00 Print Done - X i Data Table Total Number of Tests Job Total Direct Total Number of Materials Costs Parts 21,500 2,200 2,400 600 Total Direct Labor Hours 770 16 Job 721 Job 722 90 4 Print Done
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