# Question: Lytton Ltd uses a normal job costing system with two direct

Lytton Ltd. uses a normal job-costing system with two direct cost categories (direct materials and direct labour) and one indirect cost pool. It allocates manufacturing overhead to jobs using a predetermined overhead rate based on direct labour-hours. At the start of the year, the company estimated that manufacturing overhead would be \$632,000, and direct labour-hours were estimated at 32,000 hours for the year. In November, Job #X905 was completed. Materials costs on the job totaled \$13,200 and labour costs totaled \$10,120 at \$22 per hour. At the end of the year, it was determined that the company worked 34,100 direct labour-hours for the year and incurred \$656,125 in actual manufacturing overhead costs.
REQUIRED
1. Job #X905 contained 500 units. Determine the unit cost that would appear on the job-cost sheet.
2. Assuming Lytton prices its products to achieve a 25% margin, what would be the selling price of Job X905?
3. Determine the underallocated or overallocated overhead for the year.

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