Question

Exercise 2-3 Computing Total Job Costs and Unit Product Costs Using a Plantwide Predetermined Overhead Rate [LO2-3]

Mickley Company’s plantwide predetermined overhead rate is $19.00 per direct labor-hour and its direct labor wage rate is $14.00 per hour. The following information pertains to Job A-500:

Direct materials	$	280
Direct labor	$	140

Required:

1. What is the total manufacturing cost assigned to Job A-500?

2. If Job A-500 consists of 60 units, what is the unit product cost for this job?

Answer 1

Solution

1- Total manufacturing cost	$              610.00
2- Unit product cost	$                10.17

Working

Direct material	$              280.00
Direct labor	$              140.00
Manufacturing overhead	$              190.00
Total manufacturing cost	$              610.00
Number of units in job	60
Unit product cost	$                10.17

.

Labor cost	$              140.00
Labor rate per hour	$                14.00
Total hours worked	10
Predetermined overhead rate	$                19.00
Overhead appplied	$              190.00