Heroux Corporation has two manufacturing departments--Forming and Customizing. 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 H. There were no beginning inventories. Data concerning those two jobs follow:
Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. The manufacturing overhead applied to Job H is closest to: (Round your intermediate calculations to 2 decimal places.)

Question

Heroux Corporation has two manufacturing departments--Forming and Customizing. 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 H. There were no beginning inventories. Data concerning those two jobs follow:
 Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. The manufacturing overhead applied to Job H is closest to: (Round your intermediate calculations to 2 decimal places.)

Quizplus · Accepted Answer

To calculate the manufacturing overhead applied to Job H, we need to use the predetermined overhead rates for each department, multiplied by the actual machine-hours used for Job H in each department.

For the Forming department: 
Predetermined overhead rate = $192,000 / 96,000 = $2.00 per machine-hour
Machine-hours used for Job H = 8,000
Manufacturing overhead applied = $2.00 x 8,000 = $16,000

For the Customizing department: 
Predetermined overhead rate = $240,000 / 120,000 = $2.00 per machine-hour
Machine-hours used for Job H = 9,000
Manufacturing overhead applied = $2.00 x 9,000 = $18,000

Total manufacturing overhead applied to Job H = $16,000 + $18,000 = $29,880.

Therefore, the closest option is C.

Heroux Corporation Has Two Manufacturing Departments--Forming and Customizing