Calculate the cost of Job 845 using a machine hour departmental overhead rate fo

Question

Calculate the cost of Job 845 using a machine hour departmental overhead rate for the Milling Department ($32 per hour) and a direct hour overhead rate for the Finishing Department ($102 per hour). (Round your answer to the nearest dollar.)

Assume that manufacturing overhead for Goldratt Company consisted of the following activities and costs:

The following additional data were provided for Job 845:

Setup (1,000 setup hours) $118,000 Production scheduling (400 batches) 60,000 Production engineering (60 change orders) 150,000 Supervision (2,000 direct labor hours) 46,000 Machine maintenance (12,000 machine hours) 60,000 Total activity costs $434,000

Explanation / Answer

Cost of job 845 Direct material          7,000 Direct labor          1,000 Overhead applied: milling dept             800 =32*25 Finishing dept          3,570 =102*35 Total job cost        12,370

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