Question

In July, one of the processing departments at Okamura Corporation had beginning work in process inventory of $16,000 and ending we $21,000. During the month, the cost of units transferred out from the department was $151,000. In the department's cost reconciliatio to be accounted for under the weighted average method would be: O $37,000 $172,000 $135,000 $122,000 QUESTION 11 Mahon Corporation has two production departments, Casting and Customizing. The company uses a job-order costing system ar overhead rate in each production department. The Casting Department's predetermined overhead rate is based on machine-hou Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company ha Casting Customizing Machine-hours 17,800 14,800 Dtrect labor-hours 6400 7400 Total fixed manufacturing overhead cost $106,800 $ 56,240 Variable manufacturing overhead per machine-hour $ 1.70 Variable manufacturing overhead per direct labor-hour $ 3.40 During the current month the company started and finished Job T138. The following data were recorded for this job: Job T138 Casting Customizing Machine-hours 90 40 Direct labor-hours 15 90 The amount of overhead applied in the Customizing Department to Job T138 is closest to: (Round your intermediate calcu $576.00 | mot app!

Answer 1

Customizing Department overhead cost = Fixed manufacturing overhead cost + ( Variable overhead cost per direct labor-hour * Total direct labor-hours in the department)

Customizing Department overhead cost = $56240 + ($3.40 per direct labor-hour * 7,400 direct labor-hours)

Customizing Department overhead cost = $56240 + $25160

Customizing Department overhead cost = $81400

Predetermined overhead rate = Estimated total manufacturing overhead cost / Estimated total amount of the allocation base incurred = $81400 / 7,400 direct labor-hours = $11 per direct labor-hour

Overhead applied to a particular job = Predetermined overhead rate * Amount of the allocation base incurred by the job = $11 per direct labor-hour * 90 direct labor-hours = $990