Question

Hultquist Corporation has two manufacturing departments-Forming and Customizing. The company used the following data at the beginning of the period to calculate predetermined overhead rates: Estimated total machine-hours (MHS) Estimated total fixed manufacturing overhead cost Estimated variable manufacturing overhead cost per MH Forming 6,000 $ 24,000 $ 1.00 Customizing 4,000 $10,400 $ 2.00 Total 10,000 $34,400 During the period, the company started and completed two jobs--Job C and Job L. Data concerning those two jobs follow: Direct materials Direct labor cost Forming machine-hours Customizing machine-hours Job c Job L $16,400 $ 9,700 $23,100 $10,100 2,500 3,500 2,500 1,500 markup Required: a. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. Calculate that overhead rate. (Round your answer to 2 decimal places.) b. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. Calculate the amount of manufacturing overhead applied to Job L. (Do not round intermediate calculations.) c. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. Calculate the total manufacturing cost assigned to Job L. (Do not round intermediate calculations.) d. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours and uses a of 80% on manufacturing cost to establish selling prices. Calculate the selling price for Job L. (Do not round intermediate calculations.) e. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments. What is the departmental predetermined overhead rate in the Forming department? (Round your answer to 2 decimal places.) f. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. What is the departmental predetermined overhead rate in the Customizing department? (Round your answer to 2 decimal places.) g. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. How much manufacturing overhead will be applied to Job L? (Do not round intermediate calculations.) ..!

Answer 1

1) Plantwide overhead rate = (6000*1+4000*2+34400)/10000 = 4.84

2) Manufacturing overhead applied = (3500+1500)*4.84 = 24200

3) Total manufacturing cost = 9700+10100+24200 = 44000

4) Selling price = 44000*1.8 = 79200

5) Forming predetermine overhead rate = (24000/6000)+1 = 5 per MH

6) Customizing predetermine overhead rate = (10400/4000)+2 = 4.6 per MH

g) Manufacturing overhead applied = (3500*5+1500*4.6) = 24400

h) Selling price = (9700+10100+24400)*1.8 = 79560