Use the correct answers to write the case study report. Answer each question as if you were the lead staff accountant for Teledex Company and are presenting to the CEO as indicated in the case study. For each answer explain the terminology and concepts used. For example, in #$1$ rather than just give the predetermined overhead rate, explain the calculation $-$ this is a professional report from a managerial accountant to the company president. "Blast it$!"$ sald David Wison, president of Teledex Company. "We've just lost the bid on the Koopers job by $$3,000.$ It seems we're

elther too high to get the job or too low to make any money on half the jobs we bid."

Teledex Company manufactures products to customers' specifications and uses a job$-$order costing system. The company uses a

plantwide predetermined overhead rate based on direct labor cost to apply its manufacturing overhead $($assumed to be all fixed$)$ to

jobs. The following estimates were made at the beginning of the year:

Jobs requlre varying amounts of work in the three departments. The Koopers job, for example. would have required manufacturing

costs in the three departments as follows:

Required:

Using the company's plantwide approach:

a$.$ Compute the plantwide predetermined rate for the current year.

b$.$ Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.

$2$ Suppose that instead of using a plantwide predetermined overhead rate, the company had used departmental predetermined

overhead rates based on olrect labor cost. Under these conditions:

a$.$ Compute the predetermined overhead rate for each department for the current year.

b$.$ Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.

Assume that it is customary in the industry to bid jobs at $150\%$ of total manufacturing cost $($direct materials, direct labor, and applied

overhead$).$

a$.$ What was the company's bid price on the Koopers job using a plantwide predetermined overhead rate?

b$.$ What would the bid price have been If departmental predetermined overhead rates had been used to apply overhead cost?

Company's bid price

$ $,59,550$

$ $52,350$

Use outside sources when necessary BUT MAKE SURE YOU CITE THEM!

When giving a recommendation, back it up with numbers. Make sure you address the original dilemma $-$ lost bids.

This particular answer should be managerial accounting report to the company president that is no more than $2$ pages in length.