Comfort Manufacturing is a small textile manufacturer using machine-hours as the single indirect-cost rate to allocate manufacturing overhead costs to the various jobs contracted during the year. The following estimates are provided for the coming year for the company and for the Winton High School band jacket job. (Part i, ii, and iii)
Company Winton High School Job
Direct materials $40,000 $2,000
Direct labor $10,000 $400
Manufacturing overhead costs $45,000
Machine-hours 100,000 mh 900 mh
i) For Comfort Manufacturing, what is the annual manufacturing overhead cost-allocation rate?
a) $0.50
b) $0.80
c) $0.45
d) $33.33
ii) What amount of manufacturing overhead costs will be allocated to this job?
a) $405
b) $425
c) $270
d) $465
iii)) What are the total manufacturing costs of this job?
a) $1,970
b) $2,805
c) $2,905
d) $1,920