Bobs Electronics Inc. manufactures high-tech screens for computers. In June, the two production departments had...
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Accounting
Bobs Electronics Inc. manufactures high-tech screens for computers. In June, the two production departments had budgeted allocation bases of 13,000 machine hours in Department 1 and 7,100 direct manufacturing labour hours in Department 2. The budgeted manufacturing overheads for the month were $55,900 and $41,890, respectively. For Job 101, the actual costs incurred in the two departments were as follows:
Department 1
Department 2
Direct materials purchased on account
$66,000
$106,500
Direct materials used
12,500
9,100
Direct manufacturing labour
32,500
32,200
Indirect manufacturing labour
6,600
5,400
Indirect materials used
4,500
2,850
Lease on equipment
9,750
2,250
Utilities
600
750
Job 101 incurred 1,600 machine hours in Department 1 and 900 manufacturing labour hours in Department 2. The company uses a budgeted departmental overhead rate for applying overhead to production.
What is the budgeted indirect cost allocation rate for Department 1? (4 marks)
What is the budgeted indirect cost allocation rate for Department 2? (4 marks)
What is the total cost assigned to Job 101 based on normal costing? (5 marks)
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