Jason Company manufactures custom engines for use in the lawn and garden equipment industry. The company allocates manufacturing overhead based on machine hours. Selected data for costs incurred for Job 890 are as follows: What amount of manufacturing overhead would be allocated to Job 612?

Question

Jason Company manufactures custom engines for use in the lawn and garden equipment industry. The company allocates manufacturing overhead based on machine hours. Selected data for costs incurred for Job 890 are as follows:  What amount of manufacturing overhead would be allocated to Job 612?

Quizplus · Accepted Answer

Manufacturing overhead is allocated based on machine hours, and the total machine hours for Job 612 is 2,200 (1,000 + 1,200). The total manufacturing overhead for the period is $26,400 ($21,000 + $5,400). Therefore, the amount of manufacturing overhead allocated to Job 612 is $6,600 ($26,400/4).

Jason Company Manufactures Custom Engines for Use in the Lawn