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	$	10,250		$	15,150		$	25,400
Estimated variable manufacturing overhead per machine-hour	$	1.50		$	2.30

	Job P			Job Q
Direct materials	$	14,000		$	8,500
Direct labor cost	$	21,800		$	7,900
Actual machine-hours used:
Molding		1,800			900
Fabrication		700			1,000
Total		2,500			1,900

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

Required:

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

2.  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?

3.What was Sweeten Company’s cost of goods sold for March?

Answer 1

Solution:
12)	Computation of Unit Product Cost of P
	Particluars	Amount
	Direct Material	14000
	Direct Labor	21800
	Variable Magf Overhead
	Molding=(1.5*1800)	2700
	Fabrication= (2.30*700)	1610
	Fixed Mafg Overhead
	Molding=(10250*1800/2700)	6833
	Fabrication=(15150*700/1700)	6238
	Total Cost	53181
	No of units	20
	Cost per unit	2659.05
2)	Computation of Selling Price	Job P	Job Q
	Direct Material	14000	8500
	Direct Labor	21800	7900
	Variable Magf Overhead	4310	3650
	Fixed Mafg Overhead	13071	12329
	Total Manufacturing Cost	53181	32379
	Add: Mark Up 80% of the cost	42544.8	25903.2
	Total Selling Price	95725.8	58282.2
	No of Units	20	30
	Selling Price per unit	4786.29	1942.74
3)	Computation of Cost of Goods Sold
	Particulars	Amount
	Cost of Goods of Job P	53181
	Cost of Goods of Job Q	32379
	Total Cost of Goods Sold	85560