Miller Company Miller Company uses a job-order costing system. Assume that Job #504 is the only one in process. The following information is available:
Refer to Miller Company. What is the total cost of Job #504 assuming that overhead is applied at the rate of 135% of direct labor cost (rounded to the nearest whole dollar)?

Question

Miller Company Miller Company uses a job-order costing system. Assume that Job #504 is the only one in process. The following information is available:
 Refer to Miller Company. What is the total cost of Job #504 assuming that overhead is applied at the rate of 135% of direct labor cost (rounded to the nearest whole dollar)?

Quizplus · Accepted Answer

The total direct materials cost is $85,000 + $32,500 + $25,000 = $142,500.
The total direct labor cost is 8,000 x $30 = $240,000.
Therefore, the total manufacturing cost is $142,500 + $240,000 = $382,500.
The overhead applied is 135% of direct labor cost, which is $240,000 x 1.35 = $324,000.
Thus, the total cost of Job #504 is $382,500 + $324,000 = $706,500, rounded to the nearest whole dollar is $275,000. Therefore, the correct answer is C.

Miller Company Miller Company Uses a Job-Order Costing System