Fickel Company has two manufacturing departments—Assembly and Testing & Packaging. The predetermined overhead rates in Assembly and Testing & Packaging are $13.00 per direct labor-hour and $9.00 per direct labor-hour, respectively. The company’s direct labor wage rate is $16.00 per hour. The following information pertains to Job N-60: Assembly Testing & PackagingDirect materials $340 $25Direct labor $180 $40What is the total manufacturing cost assigned to Job N-60?

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facundobuzzetti facundobuzzetti · Answer 1 · 2020-02-15T14:02:55+01:00

Answer:

Total cost= $753.75

Explanation:

Giving the following information:

The predetermined overhead rates:

Assembly= $13 per direct labor-hour

Testing & Packaging= $9.00 per direct labor-hour.

The company’s direct labor wage rate is $16.00 per hour.

Job N-60:

Assembly;

DM= 340

DL=180

Testing & Packaging:

DM= 25

DL= 40

To calculate the overhead applied to each department, first, we need to calculate the direct labor hours:

Assembly= 180/16= 11.25 hours

Testing= 40/16= 2.5 hours

Now, we can allocate overhead:

Assembly= 11.25 hours*13= $146.25

Testing= 2.5 hours*9= $22.5

Total cost= DM + DL + Allocated overhead

Total cost= (340 + 25) + (180 + 40) + (146.25 + 22.5)= $753.75