placker corporation uses a job - order costing system with a single, plantwide, predetermined overhead rate…

placker 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 a total fixed manufacturing overhead cost of $155,000, variable manufacturing overhead of $3.40 per machine - hour, and 50,000 machine - hours. recently, job a881 was completed with the following characteristics:\n• total machine - hours: 100\n• direct materials: $645\n• direct labor cost: $2,300\nthe total job cost for job a881 is closest to\n$3,595.\n$2,950.\n$2,945.\n$1,295.

placker 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 a total fixed manufacturing overhead cost of $155,000, variable manufacturing overhead of $3.40 per machine - hour, and 50,000 machine - hours. recently, job a881 was completed with the following characteristics:\n• total machine - hours: 100\n• direct materials: $645\n• direct labor cost: $2,300\nthe total job cost for job a881 is closest to\n$3,595.\n$2,950.\n$2,945.\n$1,295.

Answer

Explanation:

Step1: Calculate fixed overhead rate

Fixed overhead rate = $\frac{\text{Total fixed manufacturing overhead}}{\text{Total machine - hours}}$ = $\frac{155000}{50000}=3.1$ dollars per machine - hour

Step2: Calculate total overhead rate

Total overhead rate = Fixed overhead rate + Variable overhead rate = $3.1 + 3.40=6.5$ dollars per machine - hour

Step3: Calculate overhead cost for Job A881

Overhead cost = Total overhead rate $\times$ Machine - hours for Job A881 = $6.5\times100 = 650$ dollars

Step4: Calculate total job cost

Total job cost = Direct materials + Direct labor cost + Overhead cost = $645+2300 + 650=3595$ dollars

Answer:

$$3,595$