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ra1l [238]
2 years ago
9

Crane Fabrication allocates manufacturing overhead to each job using departmental overhead rates.​ Crane's operations are divide

d into a metal casting department and a metal finishing department. The casting department uses a departmental overhead rate of​ $51 per machine​ hour, while the finishing department uses a departmental overhead rate of​ $25 per direct labor hour. Job A216 used the following direct labor hours and machine hours in the two​ departments: Actual results Casting Department Finishing Department Direct labor hours used 8 14 Machine hours used 3 6 The cost for direct labor is​ $42 per direct labor hour and the cost of the direct materials used by Job A216 is​ $2,000. What was the total cost of Job A216 if Crane Fabrication used the departmental overhead rates to allocate manufacturing​ overhead?
Business
1 answer:
IRINA_888 [86]2 years ago
4 0

Answer:

Total Cost 3,682

Explanation:

We must use for each department their overhead rate.

Then, we will add the overhead applied in the two department.

JOB A216

Casting overhead Machine hours 3

51 per machine hour casting department

Applied overhead

3 x 51 = <em>408</em>

Finishing overhead Labour hours 14

25 direct labour finishing department

Applied overhead

14 x 25 = <em>350</em>

Total overhead 350 Casting + 408 Finishing = 758

Next, we move to the other two cost components.

Direct Labor (8 casting + 14 finishing )*42 = 22*42=924

Direct Materials 2,000

Total Cost 3,682

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