Question

A-to-Z Industries has two production departments, ABC and XYZ which uses a job-order cost system. To determine manufacturing costs, the company applies manufacturing overhead to production orders based on direct labor cost using the blanket rate predetermined at the beginning of the year based on the annual budget. The 20xx budget for the two departments was as follows:

	ABC	XYZ
Direct Materials	630,000	90,000
Direct labor	180,000	720,000
Factory Overhead	540,000	360,000

Actual materials and labor costs of JOB 678 during 20xx were as follows:

Direct materials 22,500

Direct labor - ABC 7,200

Direct labor - XYZ10,800

What was the total manufacturing cost associated with Job No.678 for 20xx?

Select one:

a. 58,500

b. 45,000

c. 49,500

d. 67,500

Answer 1

Answer- d. 67,500.

You have not use any currency symbol. For calculation purpose I have taken currency as dollar ($). If you have any other currency you can simply replace the currency only, the calculation will be same.