Ask Question
7 May, 17:42

Placker Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on total fixed manufacturing overhead cost of $155,000, variable manufacturing overhead of $3.40 per machine-hour, and 50,000 machine-hours. Recently, Job A881 was completed with the following characteristics:

Total machine-hours 100

Direct materials $ 645

Direct labor cost $ 2,300

The total job cost for Job A881 is closest to: (Round your intermediate calculations to 2 decimal places.)

a. $1,295

b. $3,595

c. $2,950

d. $2,945

+3
Answers (1)
  1. 7 May, 18:05
    0
    Option B,$ 3,595.00 is correct

    Explanation:

    The sum of both fixed and variable manufacturing overhead gives the below amount:

    total overhead=$155,000 + ($3.40*50,000) = $ 325,000.00

    Plantwide predetermined overhead rate=total overhead/machine hours=$325,000.00/50,000.00=$6.50

    The job cost = (100*$6.50) + $645+$2,300=$650+$645+$2,300=$ 3,595.00

    The correct option is B $ 3,595.00

    Option C shows that the total job cost is sum of direct labor cost plus the overhead which is wrong.

    Option D showed that the total cost is the sum of direct labor cost plus the direct material which is also wrong
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Placker Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers