Sanderlin Corporation has two manufacturing departments--Machining 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 C and Job L. 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.Further assume that the company uses a markup of 20% on manufacturing cost to establish selling prices.The calculated selling price for Job C is closest to:
A) $87,666
B) $68,920
C) $13,784
D) $82,704

Question

Sanderlin Corporation has two manufacturing departments--Machining 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 C and Job L. 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.Further assume that the company uses a markup of 20% on manufacturing cost to establish selling prices.The calculated selling price for Job C is closest to:
A) $87,666 
B) $68,920 
C) $13,784 
D) $82,704

Quizplus · Accepted Answer

Machining Department predetermined overhead rate:
 11ea7761_1953_6457_81a5_9dbb6a9669c4_TB2580_00 Finishing Department predetermined overhead rate:
 11ea7761_1953_6458_81a5_6b4be5268f5b_TB2580_00 Manufacturing overhead applied to Job C:
 11ea7761_1953_6459_81a5_dbdbc21782e7_TB2580_00 The selling price for Job C would be calculated as follows:
 11ea7761_1953_8b6a_81a5_5fc50bfebf1b_TB2580_00

Sanderlin Corporation Has Two Manufacturing Departments--Machining and Finishing