Wellington Recycling recycles newsprint, cardboard, and so forth, into recycled packaging materials. ForAfter the new fiscal year began, Hollings Paper Supply asked Wellington Recycling to bid for a job that will the coming year, Wellington estimates total manufacturing overhead to be $359,640. The company's managers are not sure if direct labor hours (estimated to be 9,990) or machine hours (estimated to be 17,982 hours) is the best allocation base to use for allocating manufacturing overhead. Wellington bids for jobs using a 31% markup take 1,975 machine hours and 1,700 direct labor hours to produce. The direct labor cost for this job will be $10 per hour, and the direct materials will total $25,500 over total manufacturing cost. Read the requirements. Requirement 1. Compute the total job cost and bid price if WellingtonRecycling decided to use direct labor hours as the manufacturing overhead allocation base for the year. First calculate the predetermined overhead rate based on direct labor hours. Identify the formula and then compute the rate Estimated yearly overhead costsEstimated yearly direct labor hoursPredetermined overhead rate 359,640 9,990 36 per hour Next we will calculate the total job cost. Job Sheet Direct materials Direct labor Manufacturing overhead 25,500 17,000 61,200 103,700 Total job cost Job cost Markup for profit Bid price 135,847 103,700 32,147 Requirement 2. Compute the total job cost and bid price if Wellington Recycling decided to use machine hours as the manufacturing overhead allocation base for the year. Calculate the predetermined overhead rate based on machine hours. ldentify the formula and then compute the rate Estimated yearly overhead costsEstimated yearly machine hours Predetermined overhead rate 359,640 17,982 20 per hour Next we will calculate the total job cost. Job Sheet Direct materials Direct labor Manufacturing overhead 25,500 17,000 39,500 82,000 Total job cost Compute the bid price if Wellington decided to use machine hours as the manufacturing overhead allocation base for the year. (Round all amounts to the nearest whole dollar.) Job cost Markup for profit 25,420 Bid price 107,420 82,000 Requirement 3. In addition to the bid from Wellington Recycling, Hollings Paper Supply received a bid of $125,000 for this job from Drund Recycling. What are the ramifications for Wellington Recycling? Whether or not Wellington wins the bid will depend on the allocation base the company chose to use during the year. Wellington's bid price will be sif the company uses direct Ilabor hours as the allocation base. In this case, the company will probably will probably base results in a bid price of $ the job to Drund Recycling, since its bid was$ the bid if machine hours is used as the allocation base. Using machine hours as an allocation However, Wellington