Question

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

Total direct labor-hours		78,000
Total fixed manufacturing overhead cost	$	460,200
Variable manufacturing overhead per direct labor-hour	$	5.00

Recently, Job P951 was completed with the following characteristics:

Number of units in the job		50
Total direct labor-hours		100
Direct materials	$	710
Direct labor cost	$	7,800

The total job cost for Job P951 is closest to: (Round your intermediate calculations to 2 decimal places.)

Garrison 16e Rechecks 2017-06-22, 2017-08-01

Multiple Choice

• $8,890

• $8,510

• $1,800

• $9,600

Answer 1

Correct Option D i.e. $9600
Working Note1 :
Calculation of Total job cost
Direct MATERIAL	710
Direct labour	7,800
Variable manufacturing overhead	500	(100*5)
(No. of labour hour* VMOH per direct labour hour)
Fixed manufacturing OVERHEAD	590	(100*5.90)
(No. of labour hour* Predetermine overhead rate)
Total job cost	9,600
Note 2: Predetermined overhead rate = Estimated fixed manufacturing OH/ Estimated labour hour
=460200/78000
5.90	Per hour