Question

The following information applies to the questions displayed below.]

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	$	11,250		$	15,750		$	27,000
Estimated variable manufacturing overhead per machine-hour	$	1.90		$	2.70

	Job P			Job Q
Direct materials	$	18,000		$	10,500
Direct labor cost	$	25,000		$	9,500
Actual machine-hours used:
Molding		2,200			1,300
Fabrication		1,100			1,400
Total		3,300			2,700

Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month.

Required:

For questions 1-8, assume that Sweeten Company uses a plantwide predetermined overhead rate with machine-hours as the allocation base. For questions 9-15, assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments.

10. How much manufacturing overhead was applied from the Molding Department to Job P and how much was applied to Job Q? (Do not round intermediate calculations.)

11. How much manufacturing overhead was applied from the Fabrication Department to Job P and how much was applied to Job Q? (Do not round intermediate calculations.)

12. If Job P included 20 units, what was its unit product cost? (Do not round intermediate calculations.)

13. If Job Q included 30 units, what was its unit product cost? (Do not round intermediate calculations. Round your final answer to nearest whole dollar.)

14. 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 answer to nearest whole dollar.)

15. What was Sweeten Company’s cost of goods sold for March? (Do not round intermediate calculations.)

Answer 1

Molding overhead rate = (11250/2500+1.9) = 6.40 per hour

Fabrication overhead rate = (15750/1500+2.7) = 13.20 per hour

10)Manufacturing overhead applied to molding department

	Job P	Job Q
Molding overhead applied	2200*6.4 = 14080	8320

11)Manufacturing overhead applied to Fabrication department

	Job P	Job Q
Fabrication overhead applied	1100*13.20 = 14520	18480

12) Unit product cost of Job P

	Job P
Direct material	18000
Direct labor	25000
Molding overhead	14080
Fabrication overhead	14520
Total	71600
Unit	20
Unit product cost	3580

13) Unit product cost of Job Q

	Job Q
Direct material	10500
Direct labor	9500
Molding overhead	8320
Fabrication overhead	18480
Total	46800
Unit	30
Unit product cost	1560

14) Selling price

	Job P	Job Q
Direct material	18000	10500
Direct labor	25000	9500
Molding overhead	14080	8320
Fabrication overhead	14520	18480
Total	71600	46800
Markup	57280	37440
Selling price of Job	128880	84240
Selling price per unit	6444	2808

15) Cost of goods sold = 71600+46800 = 118400