Question

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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		23,000		33,000		56,000
Fixed manufacturing overhead cost	$	700,000	$	200,000	$	900,000
Variable manufacturing overhead cost per machine-hour	$	5.00	$	2.00

  

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	$	370,000	$	320,000	$	690,000
Direct labor cost	$	220,000	$	120,000	$	340,000
Machine-hours		15,000		8,000		23,000

  

Job C-200	Molding		Fabrication		Total
Direct materials cost	$	240,000	$	220,000	$	460,000
Direct labor cost	$	120,000	$	280,000	$	400,000
Machine-hours		8,000		25,000		33,000

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

rev: 07_21_2020_QC_CS-217627

2. Assume Delph chooses to combine its departmental rates from requirement 1 into a plantwide predetermined overhead rate based on machine-hours.

a. Compute the plantwide predetermined overhead rate.

b. Compute the total manufacturing cost assigned to Job D-70 and Job C-200.

c. If Delph establishes bid prices that are 150% of total manufacturing costs, what bid prices would it have established for Job D-70 and Job C-200?

d. What is Delph’s cost of goods sold for the year?

Answer 1