Hawkeye Corporation provides you with the following estimates of overhead costs for the upcoming year:

The company just received a job order with the following information:

The job will require $5,000 of direct material. The company pays $16 per direct labor hour.

Required:
a. Calculate the estimated inventoriable cost for the job. Allocate all overhead based on a single rate based on machine hours.
b. Repeat part A, except use departmental rates to allocate overhead costs. Use labor hours as the cost driver for the Materials Handling Department and machine hours as its cost driver in the AssemblyDepartment.

Transcribed Image Text:

Budgeted Oread Labor Hour 150,000 50,000 200,000 Machine Hours Department Materials handling Assembly Total $1,500,000 $2,500,000 $4,000,000 100,000 100,000 200,000 Debartment Labor Hour ed Mae Hours Required Materials handling Assembly 100 150 400 600