Answer:
Selling price= 240*1.4= $336
Explanation:
<u>First, we need to calculate the predetermined overhead rate:</u>
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= (252,000/30,000) + 2.1
Predetermined manufacturing overhead rate= $10.5 per machine hour
Job T687:
Number of units in the job 10
Total machine-hours 30
Direct materials $ 675
Direct labor cost $1,050
<u>Now, we need to allocate overhead and determine the total cost:</u>
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 10.5*30= $315
Total cost= 675 + 1,050 + 315= $2,040
<u>Finally, the unitary cost and selling price:</u>
Unitary cost= 2,040/10= $240
Selling price= 240*1.4= $336
