Pebbles Corporation has two manufacturing departments--Casting and Finishing. The company used the following data at the beginning of the year to calculate predetermined overhead rates: During the most recent month, the company started and completed two jobs--Job A and Job L. There were no beginning inventories. Data concerning those two jobs follow:
Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. The total manufacturing cost assigned to Job L is closest to: (Round your intermediate calculations to 2 decimal places.)

Question

Pebbles Corporation has two manufacturing departments--Casting and Finishing. The company used the following data at the beginning of the year to calculate predetermined overhead rates:  During the most recent month, the company started and completed two jobs--Job A and Job L. There were no beginning inventories. Data concerning those two jobs follow:
 Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. The total manufacturing cost assigned to Job L is closest to: (Round your intermediate calculations to 2 decimal places.)

Quizplus · Accepted Answer

The first step is to calculate the estimated total overhead costs in the two departments.
Casting
 11eacbfc_c6fb_3356_8ffe_7badb68b870c_TB7552_00 Finishing
 11eacbfc_c6fb_5a67_8ffe_f949fa84af82_TB7552_00 The second step is to combine the estimated manufacturing overhead costs in the two departments ($13,800 + $13,500 = $27,300) to calculate the plantwide predetermined overhead rate as follow:
 11eacbfc_c6fb_5a68_8ffe_8d181d6cd6c1_TB7552_00 The overhead applied to Job L is calculated as follows:
Overhead applied to a particular job = Predetermined overhead rate × Machine-hours incurred by the job
= $5.46 per MH × (600 MHs + 1,800 MHs)
= $5.46 per MH × (2,400 MHs)
= $13,104
Job L's manufacturing cost:
 11eacbfc_c6fb_8179_8ffe_1bf9435e2661_TB7552_00

Pebbles Corporation Has Two Manufacturing Departments--Casting and Finishing