50.1K

Verified Solution

Link Copied!

Wilmington Company has two manufacturing departmentsAssembly and Fabrication. It considers all of its manufacturing overhead costs to be fixed costs. The first set of data that is shown below is based on estimates from the beginning of the year. The second set of data relates to one particular job completed during the yearJob Bravo.

Estimated Data	Assembly	Fabrication	Total
Manufacturing overhead costs	$ 3,960,000	$ 4,400,000	$ 8,360,000
Direct labor-hours	110,000	66,000	176,000
Machine-hours	44,000	220,000	264,000

Job Bravo	Assembly	Fabrication	Total
Direct labor-hours	23	15	38
Machine-hours	15	18	33

Required:

1. If Wilmington used a plantwide predetermined overhead rate based on direct labor-hours, how much manufacturing overhead would be applied to Job Bravo?

2. If Wilmington uses departmental predetermined overhead rates with direct labor-hours as the allocation base in Assembly and machine-hours as the allocation base in Fabrication, how much manufacturing overhead would be applied to Job Bravo?

(Round your intermediate calculation to 2 decimal places.)

	1. Plantwide manufacturing overhead applied to Job Bravo 2. Manufacturing overhead applied from Assembly to Job Bravo 2. Manufacturing overhead applied from Fabrication to Job Bravo 2. Total departmental manufacturing overhead applied to Job Bravo $0

Q2-

Speedy Auto Repairs uses a job-order costing system. The companys direct materials consist of replacement parts installed in customer vehicles, and its direct labor consists of the mechanics hourly wages. Speedys overhead costs include various items, such as the shop managers salary, depreciation of equipment, utilities, insurance, and magazine subscriptions and refreshments for the waiting room.

The company applies all of its overhead costs to jobs based on direct labor-hours. At the beginning of the year, it made the following estimates:

Direct labor-hours required to support estimated output	34,000
Fixed overhead cost	$ 493,000
Variable overhead cost per direct labor-hour	$ 1.00

Required:

1. Compute the predetermined overhead rate.

2. During the year, Mr. Wilkes brought in his vehicle to replace his brakes, spark plugs, and tires. The following information was available with respect to his job:

Direct materials	$ 749
Direct labor cost	$ 238
Direct labor-hours used	6

Compute Mr. Wilkes total job cost.

3. If Speedy establishes its selling prices using a markup percentage of 60% of its total job cost, then how much would it have charged Mr. Wilkes?

required 1-

Predetermined overhead rateper DLH

required 2

	Direct materials Direct labor Overhead applied Total cost assigned to Mr. Wilkes $0

• required 3

  	Amount charged to Mr. Wilkes

Answer & Explanation Solved by verified expert

See Answer