Tel Corp. has the following estimated costs for 2022:

Other data: 

Tel Corp. estimates that 40,000 machine hours will be required and 20,000 direct labour hours will be worked during the year. Assume that manufacturing overhead is applied on the basis of machine hours and Job XY120 is completed during the year.

Instructions

a. Calculate the overhead rate per machine hour. 

b. Calculate the rate of direct labour per hour. 

c. Calculate the total cost of a job that will take 200 machine hours, $15,000 in direct material, and 50 direct labour hours using a normal cost system.

Transcribed Image Text:

Direct materials Direct labour Rent on factory building Sales salaries Depreciation on factory equipment Indirect labour Production supervisor's salary $ 160,000 2,000,000 150,000 250,000 80,000 120,000 150,000