Question - Bierce Corporation has two manufacturing departments--Machining and Finishing. The company used the following data at the beginning of the year to calculate predetermined overhead rates:
|
Machining
|
Finishing
|
Total
|
|
Estimated total machine-hours (MHs)
|
5,000
|
5,000
|
10,000
|
|
Estimated total fixed manufacturing overhead cost
|
$6,500
|
$29,500
|
$36,000
|
|
Estimated variable manufacturing overhead cost per MH
|
$2.00
|
$4.00
|
|
During the most recent month, the company started and completed two jobs--Job B and Job K. There were no beginning inventories. Data concerning those two jobs follow:
|
Job B
|
Job K
|
|
Direct materials
|
$16,200
|
$8,400
|
|
Direct labor cost
|
$22,700
|
$2,500
|
|
Machining
machine-hours
|
4,000
|
2,500
|
|
Finishing machine-hours
|
1,000
|
20
|
Required:
a. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. Calculate that overhead rate.
b. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. Calculate the amount of manufacturing overhead applied to Job B.
c. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. Calculate the amount of manufacturing overhead applied to Job K. (Do not round intermediate calculations.
d. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments. What is the departmental predetermined overhead rate in the Machining department?
e. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. What is the departmental predetermined overhead rate in the Finishing department?
f. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. How much manufacturing overhead will be applied to Job B?
g. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. How much manufacturing overhead will be applied to Job K?