Question

Sweeten Company had no jobs in progress at the beginning of March and no beginning inventories. The company has two manufacturing departments—Molding and Fabrication. It started, completed, and sold only two jobs during March—Job P and Job Q. The following additional information is available for the company as a whole and for Jobs P and Q (all data and questions relate to the month of March):

	Molding			Fabrication			Total
Estimated total machine-hours used		2,500			1,500			4,000
Estimated total fixed manufacturing overhead	$	14,500		$	17,700		$	32,200
Estimated variable manufacturing overhead per machine-hour	$	3.20		$	4.00

	Job P			Job Q
Direct materials	$	31,000		$	17,000
Direct labor cost	$	35,400		$	14,700
Actual machine-hours used:
Molding		3,500			2,600
Fabrication		2,400			2,700
Total		5,900			5,300

Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month. For questions 10- 16 assume that Sweeten Company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments and Job P included 20 units and Job Q included 30 units. For questions 10-15, assume that the company uses a plantwide predetermined overhead rate with machine-hours as the allocation base.

9.What were the company’s predetermined overhead rates in the Molding Department and the Fabrication Department? Molding - Fabrication-

10. How much manufacturing overhead was applied from the Molding Department to Job P and how much was applied to Job Q?

JOB P -

JOB Q -

11. How much manufacturing overhead was applied from the Fabrication Department to Job P and how much was applied to Job Q?

JOB P -

JOB Q -

12. What was the total manufacturing cost assigned to Job P?

13. If Job P included 20 units, what was its unit product cost?

14. What was the total manufacturing cost assigned to Job Q?

15. If Job Q included 30 units, what was its unit product cost?

16. Assume that Sweeten Company used cost-plus pricing (and a markup percentage of 80% of total manufacturing cost) to establish selling prices for all of its jobs. What selling price would the company have established for Jobs P and Q? What are the selling prices for both jobs when stated on a per unit basis?

JOB P -

JOB Q -

Answer 1

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Answer 9
Calculation of predetermined departmental OH Rate	Molding	Fabrication	Note
Machine Hours	2,500.00	1,500.00	A
Fixed Manufacturing overhead	14,500.00	17,700.00	B
Predetermined Departmental Fixed OH Rate	5.80	11.80	C=B/A
Variable OH Rate	3.20	4.00	D
Predetermined Departmental OH Rate	9.00	15.80	E=C+D

Workings for Answer 10
Calculation of predetermined Plant wide OH Rate	Molding	Fabrication	Total	Note
Machine Hours	2,500.00	1,500.00	4,000.00	See A
Variable OH Rate	3.20	4.00		See D
Variable OH amount	8,000.00	6,000.00	14,000.00	F=A*D
Fixed Manufacturing overhead	14,500.00	17,700.00	32,200.00	See B
Total OH amount	22,500.00	23,700.00	46,200.00	G=F+B
Predetermined Plant wide OH Rate			11.55	H=G/A

Answer 10	Job P	Job Q	Note
Machine hours used- Molding	3,500.00	2,600.00	I
Predetermined Plant wide OH Rate	11.55	11.55	See H
Overhead applied	40,425.00	30,030.00	J=H*I
Answer 11	Job P	Job Q
Machine hours used- Fabrication	2,400.00	2,700.00	K
Predetermined Plant wide OH Rate	11.55	11.55	See H
Overhead applied	27,720.00	31,185.00	L=H*K

Answer 12
Manufacturing cost assigned to Job P	Amount $	Note
Direct Materials	31,000.00
Direct Labor	35,400.00
Overhead applied- Molding	40,425.00	See J
Overhead applied- Fabrication	27,720.00	See L
Manufacturing cost assigned to Job P	134,545.00	M
Answer 13	Amount $
Manufacturing cost assigned to Job P	134,545.00	See M
Number of units	20.00	N
Unit product cost for Job P	6,727.25	O=M/N
Answer 14
Manufacturing cost assigned to Job Q	Amount $
Direct Materials	17,000.00
Direct Labor	14,700.00
Overhead applied- Molding	30,030.00	See J
Overhead applied- Fabrication	31,185.00	See L
Manufacturing cost assigned to Job Q	92,915.00	P
Answer 15	Amount $
Manufacturing cost assigned to Job Q	92,915.00	See P
Number of units	30.00	Q
Unit product cost for Job Q	3,097.17	R=P/Q

Answer 16	Job P	Job Q	Note
Unit product cost	6,727.25	3,097.17	S= See O, R
Mark up at 80%	5,381.80	2,477.73	T=S*80%
Selling price	12,109.05	5,574.90	U=S+T