Question

Delph Company uses a job-order costing system and has two manufacturing departments—Molding and Fabrication. The company...

Delph Company uses a job-order costing system and has two manufacturing departments—Molding and Fabrication. The company provided the following estimates at the beginning of the year:

  

Molding Fabrication Total
Machine-hours 21,000 31,000 52,000
Fixed manufacturing overhead costs $ 710,000 $ 210,000 $ 920,000
Variable manufacturing overhead cost per machine-hour $ 5.70 $ 5.70

During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobs—Job D-70 and Job C-200. It provided the following information related to those two jobs:

  

Job D-70: Molding Fabrication Total
Direct materials cost $ 377,000 $ 329,000 $ 706,000
Direct labor cost $ 240,000 $ 160,000 $ 400,000
Machine-hours 15,000 6,000 21,000

  

Job C-200: Molding Fabrication Total
Direct materials cost $ 260,000 $ 270,000 $ 530,000
Direct labor cost $ 130,000 $ 290,000 $ 420,000
Machine-hours 6,000 25,000 31,000

Delph had no underapplied or overapplied manufacturing overhead during the year.

QUESTIONS:

1) Compute the departmental predetermined overhead rates. (Round the final answers to 2 decimal places.)

Pre determined overhead rates
Molding Department per MH
Fabrication Department per MH

2) Compute the total manufacturing cost assigned to Job D-70 and Job C-200. (Round your intermediate calculations to 2 decimal places. Round your final answers to nearest whole dollar amount.)

Total manufacturing cost   
Job D-70
Job C-200

3. If Delph establishes bid prices that are 120% of total manufacturing costs, what bid prices would it have established for Job D-70 and Job C-200? (Round your intermediate calculations to 2 decimal places. Round your final answers to nearest whole dollar amount.)

Bid price
Job D-70.   
Job C-200

4. What is Delph’s cost of goods sold for the year? (Round your intermediate calculations to 2 decimal places. Round your final answer to nearest whole dollar amount.)

Cost of goods sold   

Homework Answers

Answer #1

1) Compute the departmental predetermined overhead rates. (Round the final answers to 2 decimal places.)

Pre determined overhead rates
Molding Department 710000/21000+5.70 = 39.51 per MH
Fabrication Department 210000/31000+5.70 = 12.47 per MH

2) Total manufacturing cost

Job D-70 Job C-200
Direct material 706000 530000
Direct labor 400000 420000
Molding overhead 15000*39.51 = 592650 237060
Fabrication overhead 6000*12.47 = 74820 311750
Total manufacturing cost 1773470 1498810

3) Bid price

Job D-70 = 1773470*1.2 = 2128164

Job C-200 = 1498810*1.2 = 1798572

4) Cost of goods sold = 1773470+1498810 = $3272280

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