Delph Company uses a job costing system and has two manufacturing departments: Molding and Fabrication. The company provided the following estimates at the beginning of the year:

	Frame		Manufacturing			Total
machine hours		29,000		39,000		68,000
Fixed overhead manufacturing costs	ps	730.000	ps	260.000	ps	990,000
Variable manufacturing overhead cost per machine-hour	ps	5.30	ps	5.30

During the year, the company had no beginning or ending inventories and started, completed, and sold only two jobs: job D-70 and job C-200. He provided the following information related to those two jobs:

Job D-70:	Frame		Manufacturing		Total
Direct Material Cost	ps	378,000	ps	322,000	ps	700,000
Direct labor cost	ps	230.000	ps	170.000	ps	400.000
machine hours		21,000		8,000		29,000

Job C-200:	Frame		Manufacturing		Total
Direct Material Cost	ps	250.000	ps	300.000	ps	550.000
Direct labor cost	ps	150.000	ps	240.000	ps	390.000
machine hours		8,000		31,000		39,000

Delph had no underapplied or overapplied manufacturing overhead during the year.

Required:

1. Suppose Delph uses a predetermined plant-wide overhead rate based on machine-hours.

to. Calculate the default plant-wide overhead rate.

b. Calculate the total manufacturing cost assigned to job D-70 and job C-200.

C. If Delph sets bid prices that are 130% of the total cost of manufacture, what bid prices would he have set for job D-70 and job C-200?

d. What is Delph's cost of goods sold for the year?

2. Suppose Delph uses predetermined overhead rates by department based on machine-hours.

to. Calculate the departmental default overhead rates.

b. Calculate the total manufacturing cost assigned to job D-70 and job C-200.

C. If Delph sets bid prices that are 130% of total manufacturing costs, what bid prices would he have set for job D-70 and job C-200?

d. What is Delph's cost of goods sold for the year?

Answer rating: 100% (QA)

1 Using a Predetermined Plant Wide Overhead Rate a To calculate the predetermined plant wide overhead rate divide the total estimated overhead costs by the total estimated machine hours Total estimate View the full answer