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Delph Company uses a job-order costing system and has two manufacturing departmentsMolding and Fabrication. The company provided the following estimates at the beginning of the year:
Molding
Fabrication
Total
Machine-hours
31,000
41,000
72,000
Fixed manufacturing overhead costs
$
740,000
$
210,000
$
950,000
Variable manufacturing overhead cost per machine-hour
$
5.50
$
5.50
During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobsJob D-70 and Job C-200. It provided the following information related to those two jobs:
Job D-70:
Molding
Fabrication
Total
Direct materials cost
$
378,000
$
322,000
$
700,000
Direct labor cost
$
230,000
$
160,000
$
390,000
Machine-hours
24,000
7,000
31,000
Job C-200:
Molding
Fabrication
Total
Direct materials cost
$
290,000
$
230,000
$
520,000
Direct labor cost
$
160,000
$
270,000
$
430,000
Machine-hours
7,000
34,000
41,000
Delph had no underapplied or overapplied manufacturing overhead during the year.
Exercise 2-15 Part 2
2. Assume Delph uses departmental predetermined overhead rates based on machine-hours.
a. Compute the departmental predetermined overhead rates.
b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200.
c. If Delph establishes bid prices that are 140% of total manufacturing costs, what bid prices would it have established for Job D-70 and Job C-200?
d. What is Delphs cost of goods sold for the year?
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