Answer:
1. Cutting Department = $8.99 per machine hour and Finishing Department = $11.53 per direct labor hour.
2. The total manufacturing overhead cost assigned to Job 203 is $2,058.46.
3. Yes. Plant wide pre-determined overhead rate does not consider the cost driver in the departments involved.
Explanation:
<em>Predetermined overhead rate = Budgeted Overheads / Budgeted Activity</em>
Cutting Department = $390,000 / 43,400
= $8.99 per machine hour
Finishing Department = $496,000 / 43,000
= $11.53 per direct labor hour
<u>Total manufacturing overhead cost assigned to Job 203.</u>
Direct materials
Cutting Department $ 745.00
Finishing Department $ 370
.00
Direct labor costs
Cutting Department $ 43.00
Finishing Department $ 210.00
Variable manufacturing overhead
Cutting Department ($2.00 × 43) $86.00
Finishing Department ($2.00 × 4) $8.00
Variable manufacturing overhead
Cutting Department ($3.75 × 3) $11.25
Finishing Department ($3.75 × 13) $48.75
Fixed manufacturing overhead
Cutting Department ($8.99 × 43) $386.57
Finishing Department ($11.53 × 13) $149.89
Total $2,058.46
