Olga Ltd produces stapling machines for most businesses operating in New Orleans. The production process involves three stages: cutting department, assembly department and painting and finishing department.

Each department is treated as a cost center. The management estimates that the total manufacturing overheads will be $136,000, allocated as follows:

Total production in units for the period is estimated at 16,000 stapling machines. The budgeted materials and labor cost per stapling machine are:

Overhead is absorbed by machine hours (cutting departing), labor hours (assembly department), and per unit of production (painting and finishing department).

Required

Compute the total manufacturing cost for the total units produced.

Transcribed Image Text:

Cutting Assembly Painting and finishing $56,000 $48,000 $32,000