Question

The following data have been recorded for recently completed Job 323 on its job cost sheet. Direct materials cost was $2,118. A total of 40 direct labor-hours and 257 machine-hours were worked on the job. The direct labor wage rate is $18 per labor-hour. The Corporation applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $22 per machine-hour. The total cost for the job on its job cost sheet would be:
a. $5,867
b. $10,637
c. $8,492
d. $5,448

Answer 1

Answer:

Option (c) is correct.

Explanation:

Given that,

Direct materials cost = $2,118

Total direct labor-hours = 40

Total machine hours = 257

Direct labor wage rate = $18 per labor-hour

Predetermined overhead rate = $22 per machine-hour

Total cost for the job:

= Direct materials cost + Direct labor cost + Overhead cost

= $2,118 + (40 hours × $18 per hour) +  (257 hours × $22 per machine hour)

= $2,118 + $720 + $5,654

= $8,492