Delph Company uses job-order costing with a plantwide predetermined overhead rate based on machine-hours. At the...
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Delph Company uses job-order costing with a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, the company estimated that 57,000 machine-hours would be required for the period's estimated level of production. It also estimated $1,040,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $5.00 per machine-hour. Because Delph has two manufacturing departments-Molding and Fabrication-it is considering replacing its plantwide overhead rate with departmental rates that would also be based on machine-hours. The company gathered the following information to enable calculating departmental overhead rates: Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead cost per machine-hour Molding 24,000 $740,000 $ 5.00 Fabrication 33,000 $ 300,000 $ 1.50 Total 57,000 $ 1,040,000 During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobs- Job D-70 and Job C-200. It provided the following information related to those two jobs: Job D-70 Direct materials cost Direct labor cost Machine-hours Molding $ 370,000 $220,000 16,000 Fabrication $ 320,000 $ 140,000 8,000 Total $690,000 $360,000 24,000 Job C-200 Molding Direct materials cost $ 280,000 Direct labor cost Machine-hours $ 120,000 8,000 Fabrication $ 220,000 $ 280,000 25,000 Total $ 500,000 $ 400,000 33,000 Delph had no underapplied or overapplied manufacturing overhead during the year. Required: 1. Assume Delph uses plantwide predetermined overhead rates based on machine-hours. a. Compute the plantwide predetermined overhead rate. b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200. c. If Delph establishes bid prices that are 150% of total manufacturing costs, what bid prices would it have established for Job D-70 and Job C-200? d. What is Delph's cost of goods sold for the year? Delph Company uses job-order costing with a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, the company estimated that 57,000 machine-hours would be required for the period's estimated level of production. It also estimated $1,040,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $5.00 per machine-hour. Because Delph has two manufacturing departments-Molding and Fabrication-it is considering replacing its plantwide overhead rate with departmental rates that would also be based on machine-hours. The company gathered the following information to enable calculating departmental overhead rates: Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead cost per machine-hour Molding 24,000 $740,000 $ 5.00 Fabrication 33,000 $ 300,000 $ 1.50 Total 57,000 $ 1,040,000 During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobs- Job D-70 and Job C-200. It provided the following information related to those two jobs: Job D-70 Direct materials cost Direct labor cost Machine-hours Molding $ 370,000 $220,000 16,000 Fabrication $ 320,000 $ 140,000 8,000 Total $690,000 $360,000 24,000 Job C-200 Molding Direct materials cost $ 280,000 Direct labor cost Machine-hours $ 120,000 8,000 Fabrication $ 220,000 $ 280,000 25,000 Total $ 500,000 $ 400,000 33,000 Delph had no underapplied or overapplied manufacturing overhead during the year. Required: 1. Assume Delph uses plantwide predetermined overhead rates based on machine-hours. a. Compute the plantwide predetermined overhead rate. b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200. c. If Delph establishes bid prices that are 150% of total manufacturing costs, what bid prices would it have established for Job D-70 and Job C-200? d. What is Delph's cost of goods sold for the year?
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Related Book For
Managerial Accounting
ISBN: 978-0077522940
15th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
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