Asked by Yujing Huang on May 09, 2024

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Meenach Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on direct labor-hours. The company based its predetermined overhead rate for the current year on 54,000 direct labor-hours, total fixed manufacturing overhead cost of $54,000, and a variable manufacturing overhead rate of $2.40 per direct labor-hour. Recently Job X387 was completed and required 210 direct labor-hours.Required:Calculate the amount of overhead applied to Job X387. (Do not round intermediate calculations.)

Predetermined Overhead Rate

A rate calculated before a production period based on estimated overhead costs and estimated activity, used to allocate overhead costs to products.

  • Evaluate the level of manufacturing overhead assigned to an individual job through a predetermined overhead rate.
  • Examine the impact of static manufacturing overhead on the computation and documentation of costs.
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Diana BeltranMay 12, 2024
Final Answer :
Estimated total manufacturing overhead cost = Estimated total fixed manufacturing overhead cost + (Estimated variable overhead cost per unit of the allocation base × Estimated total amount of the allocation base) = ${{[a(2)]:#,###}} + (${{[a(3)]:#,###.00}} per direct labor-hour × {{[a(1)]:#,###}} direct labor-hours) = ${{[a(2)]:#,###}} + ${{[a(8)]:#,###}} = ${{[a(5)]:#,###}}Predetermined overhead rate = Estimated total manufacturing overhead cost ÷ Estimated total amount of the allocation base = ${{[a(5)]:#,###}} ÷ {{[a(1)]:#,###}} direct labor-hours = ${{[a(6)]:#,###.00}} per direct labor-hourOverhead applied to a particular job = Predetermined overhead rate × Amount of the allocation base incurred by the job = ${{[a(6)]:#,###.00}} per direct labor-hour × {{[a(4)]:#,###}} direct labor-hours = ${{[a(7)]:#,###}}