Question

16).Job Blue2B incurred the following: $20,000 direct material, $15,700 direct labor, 600 machine hours, and 750 labor hours. The company uses a single plant-wide overhead rate based on machine hours. The overhead rate is $8 per machine hour. What is the total cost for job Blue2B?

a).$40,500 b).$46,500 c).$41,700 d).$35,700

17).Details for job 5A are: direct material $1500, direct labor $700, labor hours 30, machine hours 25. The overhead rate is $3 per machine hour. The sales markup percentage is 200%.  Selling price for job 5A is:

a).$4,550 b).$4,580 c).$3,412.50 d).$4,730

18).

Luster, LLC uses departmental overhead rates for the fabrication and painting departments. Relevant data is below.

Fabrication department: $10,000 fixed overhead, variable overhead $19 per labor hour

Painting department: $20,000 fixed overhead, variable $8 per machine hour

The company estimated the following hours:

Fabrication department: 1,000 labor hours and 900 machine hours

Painting department: 1,300 labor hours and 400 machine hours

The overhead rate is applied based on machine hours in the fabrication department and labor hours in the painting department. What is the overhead rate for the painting department?

a).$17.85 b).$58.00 c).$111.75 d).$36.85

Answer 1

Answer-16)- The total cost for job Blue2B= $40500.

Explanation- Total cost for job Blue2B = Direct materials+ Direct labor+ Overhead

= $20000+$15700+($8 per machine hour*600 machine hours)

= $20000+$15700+$4800

= $40500

17)- Selling price for job 5A is = $4550.

Explanation- Selling price for job 5A = Total costs* Sales markup percentage

= $1500+$700+($3 per machine hour*25 machine hours)*200%

= $2275*200%

= $4550

18)- The overhead rate for the painting department is = $17.85.

Explanation- Overhead rate for the painting department = Total overhead/Total labor hours

= {$20000+($400 machine hours*$8 per machine hour)}/1300 labor hours

= $23200/1300 labor hours

= $17.85 per hour.

Where – Total overhead = Fixed overhead+ Variable overhead