Lupo Corporation uses a job-order costing system with a single plantwide predete
ID: 2392908 • Letter: L
Question
Lupo Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on the following data: Total machine-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine- hour 30,300 $575,700 4 Recently, Job T687 was completed with the following characteristics: Number of units in the job Total machine-hours Direct materials Direct labor 10 30 $ 730 $1,460 cost The amount of overhead applied to Job T687 is closest to: (Round your intermediate calculations to 2 decimal places.)Explanation / Answer
Fixed manufacturing overhead rate = Total fixed manufacturing overhead cost / Total machine hours
= 575700/30300 = 19 per machine hour
Total machine hours in the job = 30
Total fixed manufacturing overhead cost in Job T687 = 30*19 = 570
Variable manufacturing overhead per hour = 4
Total variable manufacturing overhead cost in Job T687 = 30*4 = 120
Total overhead cost applied to Job T687 = 570 + 120 = 690
Answer is $690.00
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