Question

t5

Lupo Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on the following data:

Total machine-hours		30,000
Total fixed manufacturing overhead cost	$	252,000
Variable manufacturing overhead per machine-hour	$	2.10

Recently, Job T687 was completed with the following characteristics:

Number of units in the job		10
Total machine-hours		30
Direct materials	$	675
Direct labor cost	$	1,050

The estimated total manufacturing overhead is closest to:

Multiple Choice

• $315,000

• $252,000

• $252,002

• $63,000

Answer 1

Total estimated variable overhead=($2.1*30,000 machine hours)

=$63,000

Total estimated overhead=Total estimated variable overhead+Total estimated fixed overhead

=252,000+63,000

which is equal to

=$315,000