The Carlson Company uses a job-costing system at its Dover, Delaware, plant. The plant has a machining department and a finishing department. Carlson uses normal costing with two direct-cost categories (Direct materials and direct manufacturing-labor) and two manufacturing overhead cost pools (the machining department with machine-hours as the allocation-base, and the finishing department with direct manufacturing labor costs as the allocation-base). The 2014 budget for the plant is as follows:

	Machining Department	Finishing Department
Manufacturing overhead costs	$10,660,000	$8,405,000
Direct manufacturing labor costs	$970,000	$4,100,000
Direct manufacturing labor-hours	35,000	145,000
Machine-hours	205,000	34,000

1. Identify the components of the overview diagram of Carlson's job-costing system.

2. What is the building manufacturing overhead rate in the machining department? In the finishing department?

3. During the month of January, the job-cost record for Job 431 shows the following:

	Machining Department	Finishing Department
Direct materials used	$12,000	$2,000
Direct manufacturing labor costs	$700	$1,100
Direct manufacturing labor-hours	30	50
Machine-hours	120	15

Compute the total manufacturing overhead cost allocated to Job 431.

4. Assuming that Job 431 consisted of 200 units of product, what is the cost per unit?

5. Amounts at the end of 2014 are as follows:

	Machining Department	Finishing Department
Manufacturing overhead incurred	$12,380,000	$9,485,000
Direct manufacturing labor costs	$980,000	$4,700,000
Machine-hours	240,000	31,000

Compute the under or overallocated manufacturing overhead for each department and for the Dover plant as a whole.

6. Why might Carlson use two different manufacturing overhead cost pools in its job-costing system?

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