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eBook Calculator Print Item Overhead Rates, Unit Costs Folsom Company manufactures specialty tools to customer order. There a
. 7 Assignment/takeAssignmentMain.do?invokere&takeAssignmentSessionLocator=&inprogress=false Keyboarding Language Arts Math R
predare Up Tuturing cost. Required: 1. Calculate a plantwide rate for Folsom Company based on machine hours. per machine hour
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Answer #1

Welding

Assembly

Finishing

Totals

Estimated Overheads

$2,20,000

$62,000

$1,50,000

$4,32,000

Direct Labor hours

4500

10000

6000

20500

Direct Labor Cost

$90,000

$1,50,000

$1,20,000

$3,60,000

Machine Hours

5000

1000

2000

8000

1

Predetermined Overhead Rate

Estimated Annual Overhead / Estimated Annual Machine Hours

$432000/8000 machine hrs.

$54

per machine hour

Bid Price

Job 1

Job 2

Direct Materials

$6,725

$9,340

Direct Labour

$1,800

$3,100

Manufacturing Overheads*

$10,800

$10,800

Total Job Cost

$19,325

$23,240

Mark up for Profit (35%)

$6,763.75

$8,134

Bid Price

$26,088.75

$31,374

*

Note:

Job 1

Job 2

Machine Hours

Welding

50

50

Assembly

60

25

Finishing

90

125

Total Machine Hours

200

200

Predetermined Overhead Rate

$54

$54

Manufacturing Overheads

$10,800

$10,800

2

Departmental Overhead Rates

Estimated Annual Overhead for the Department / Estimated Annual Activity Level for the Department

Welding

$2,20,000 / 5000 Mch. Hrs.

$44

per machine hour

Assembly

$62,000 / 10000 Lab. Hrs.

$6.20

per labor hour

Finishing

$1,50,000 / 2000 Mch. Hrs.

$75

per machine hour

Bid Price

Job 1

Job 2

Direct Materials

$6,725

$9,340

Direct Labour

$1,800

$3,100

Manufacturing Overheads*

$9,322

$11,699

Total Job Cost

$17,847

$24,139

Mark up for Profit (35%)

$6,246.45

$8,448.65

Bid Price

$24,093.45

$32,587.65

*

Note:

Welding

Assembly

Finishing

Job 1

Activity

50 Mch Hrs.

60 Lab. Hrs.

90 Mch Hrs.

Departmental Overhead Rate

$44

$6.20

$75

Manufacturing overheads

$2,200

$372.00

$6,750

$9,322

Job 2

Activity

50 Mch Hrs.

20 Lab. Hrs.

125 Mch Hrs.

Departmental Overhead Rate

$44

$6.20

$75

Manufacturing overheads

$2,200

$124.00

$9,375

$11,699

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