Question

The following data have been recorded for recently completed Job 450 on its job cost sheet. Direct materials cost was $1,678. A total of 30 direct labor-hours and 46 machine-hours were worked on the job. The direct labor wage rate is $12 per labor-hour. The Corporation applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $18 per machine-hour. What is the total cost for Job 450?

a.) 2,770

b.) 2,590

c.) 1,754

d.) 2,866

Answer 1

Direct materials = $1,678

Direct labor hours = 30

Machine hours = 46

Direct labor rate = $12 per labor hour

Direct labor cost = Direct labor hours x Direct labor rate

= 30 x 12

= $360

Predetermined overhead rate = $18 per machine hour

Manufacturing overhead applied = Machine hours x  Predetermined overhead rate

= 46 x 18

= $828

Total cost = Direct materials + Direct labor cost + Manufacturing overhead applied

= 1,678+360+828

= $2,866

The total cost for Job 450 = $2,866

Correct option is d.

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