In: Accounting
Please answer all the questions
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 | $ | 10,000 | $ | 15,000 | $ | 25,000 | |||
Estimated variable manufacturing overhead per machine-hour | $ | 1.40 | $ | 2.20 | |||||
Job P | Job Q | |||||
Direct materials | $ | 13,000 | $ | 8,000 | ||
Direct labor cost | $ | 21,000 | $ | 7,500 | ||
Actual machine-hours used: | ||||||
Molding | 1,700 | 800 | ||||
Fabrication | 600 | 900 | ||||
Total | 2,300 | 1,700 | ||||
Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month.
1. How much manufacturing overhead was applied to Job P and how much was applied to Job Q? (Do not round intermediate calculations.)
2. What was the total manufacturing cost assigned to Job P? (Do not round intermediate calculations.)
3. What was the total manufacturing cost assigned to Job Q? (Do not round intermediate calculations.)
4. 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 assuming 20 units were produced for Job P and 30 units were produced for Job Q? (Do not round intermediate calculations. Round your final answers to nearest whole dollar.)
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Part -1 | (Machine Hours*Predetermined Overhead Rate) | ||||
Job P | 2300*7.95 | $ 18,285 | |||
Job Q | 1700*7.95 | $ 13,515 | |||
Part -2 | |||||
Direct Materials | $ 13,000 | ||||
Direct Labor | $ 21,000 | ||||
Overheads | $ 18,285 | ||||
Total Manufacturing Cost P | $ 52,285 | ||||
Part -3 | |||||
Direct Materials | $ 8,000 | ||||
Direct Labor | $ 7,500 | ||||
Overheads | $ 13,515 | ||||
Total Manufacturing Cost Q | $ 29,015 | ||||
Part -4 | |||||
Job P | Job Q | ||||
Total Cost | $ 52,285 | $ 29,015 | |||
Mark UP 80% | $ 41,828 | $ 23,212 | |||
Total Selling Price | $ 94,113 | $ 52,227 | |||
Units | 20 | 30 | |||
Selling Price per unit | $ 4,706 | $ 1,741 | |||