Giannacopoulos SA uses a job-costing system at its Korinthos plant. The plant has a Machining Department and an Assembly Department. Its job-costing system has two direct-cost categories (direct materials and direct manufacturing labour) and two manufacturing overhead cost pools (the Machining Department, allocated using actual machine-hours, and the Assembly Department, allocated using actual labour cost). The 2015 budget for the plant is as follows:

Required
1. Present an overview diagram of Giannacopoulos's job-costing system. What is the budgeted overhead rate that should be used in the Machining Department? In the Assembly Department?
2. During the month of February, the cost record for Job 494 shows the following:

What is the total manufacturing overhead allocated to Job 494?
3. Balances at the end of 2015 are as follows:
Machining Assembly
Department Department
Manufacturing overhead incurred................‚¬2 100 000............‚¬3 700 000
Direct manufacturing labour cost............................-.............‚¬2 200 000
Machine-hours............................................55 000........................-
Calculate the under- or overallocated manufacturing overhead for each department.

Transcribed Image Text:

Manufacturing overhead Direct manufacturing labour cost Direct manufacturing labour-hours Machine-hours Machining Department 1 800 000 1 400 000 100 000 50 000 Assembly Department 3 600 000 2 000 000 200 000 200 000 Machining Department C45 000 14 000 Assembly Department Direct material used Direct manufacturing labour cost Direct manufacturing labour-hours Machine-hours 70 000 15 000 1 500 1 000 1 000 2 000