Sanderlin Corporation has two manufacturing departments-Machining and Finishing.
ID: 2329840 • Letter: S
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: Estimated total machine-hours (MHs) Estimated total fixed manufacturing overhead cost 26, 500 13, 500 40,000 Estimated variable manufacturing overhead cost per 2.00 3.00 MH 5,000 5,000 10,000 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 Job cJob L $12,500 $8,200 Direct materials Direct labor cost $20,200 6, 400 Machining machine- 3,400 1,600 hours Finishing machine hours 3,000 2,000 K Prev 10 of 15 E Next opExplanation / Answer
Calculation of Selling price Estimated fixed manufacturing overhead(machining) $ 26,500.00 total machine hours $ 5,000.00 Fixed overhead Rate = estimated fixed oh/total machine hours $ 5.30 Estimated fixed manufacturing overhead (finishing) $ 13,500.00 total machine hours $ 5,000.00 Fixed overhead Rate = estimated fixed oh/total machine hours $ 2.70 computation of selling price of Job C computation of selling price of Job C Direct material $ 12,500.00 Direct labour cost $ 20,200.00 Fixed manufacturing overhead ( machining)(3400*5.3) $ 18,020.00 Fixed manufacturing overhead ( finishing)(2000*2.7) $ 5,400.00 Variable manufacturing overhead (machining)(3400*2) $ 6,800.00 variable manufacturing overhead (finishing)(2000*3) $ 6,000.00 Total manufacturing cost $ 68,920.00 Add: mark up 20% of 68920 $ 13,784.00 Selling price = total manufacturing cost+markup $ 82,704.00
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