Question

# High Desert Potteryworks makes a variety of pottery products that it sells to retailers. The company...

High Desert Potteryworks makes a variety of pottery products that it sells to retailers. The company uses a job-order costing system in which departmental predetermined overhead rates are used to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Molding Department is based on machine-hours, and the rate in the Painting Department is based on direct labor-hours. At the beginning of the year, the company provided the following estimates:

 Department Molding Painting Direct labor-hours 31,000 51,200 Machine-hours 86,000 39,000 Fixed manufacturing overhead cost \$ 275,200 \$ 476,160 Variable manufacturing overhead per machine-hour \$ 2.20 - Variable manufacturing overhead per direct labor-hour - \$ 4.20

Job 205 was started on August 1 and completed on August 10. The company's cost records show the following information concerning the job:

 Department Molding Painting Direct labor-hours 86 125 Machine-hours 300 73 Direct materials \$ 942 \$ 1,120 Direct labor cost \$ 710 \$ 1,020

Required:

1. Compute the predetermined overhead rates used in the Molding Department and the Painting Department.

2. Compute the total overhead cost applied to Job 205.

3-a. What would be the total manufacturing cost recorded for Job 205?

3-b. If the job contained 31 units, what would be the unit product cost?

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