Question

ucas Industries uses departmental overhead rates to allocate its manufacturing overhead to jobs. The company has two​ departments: Assembly and Sanding. The Assembly Department uses a departmental overhead rate of $ 60 per machine​ hour, while the Sanding Department uses a departmental overhead rate of $ 15 per direct labor hour. Job 603 used the following direct labor hours and machine hours in the two​ departments: Actual results Assembly Department Sanding Department Direct labor hours used 8 4 Machine hours used 9 5 The cost for direct labor is $ 25 per direct labor hour and the cost of the direct materials used by Job 603 is $ 1 comma 600. How much manufacturing overhead would be allocated to Job 603 using the departmental overhead​ rates?

Answer 1

Answer:

$600

Explanation:

The computation of the total manufacturing overhead allocated is

= Assembly department + sanding department

where,

Assembly department = Departmental overhead rate ×  machine hour

                                      = $60 × 9

                                      = $540

And, the sanding department is

= Departmental overhead rate × direct labor hour

= $15 × 4

= $60

So, the total manufacturing overhead allocated is

= $540 + $60

= $600