Question

comfort manufacturing is a small textile manufacturer using machine-hours as the single indirect-cost rate to allocate manufacturing overhead costs to the various jobs contracted during the year. the following estimates are provided for the coming year for the company and for the winton high school band jacket job. company winton high school job direct materials $40,000 $2,000 direct labor $10,000 $400 manufacturing overhead costs $45,000 machine-hours 100,000 mh 900 mh what is the bid price for the winton high school job if the company uses a 40% markup of total manufacturing costs?

Answer 1

$0.45

Step-by-step explanation:

The computation of the annual manufacturing overhead cost-allocation rate is shown below:

Annual manufacturing overhead cost allocation rate is

= Manufacturing overhead costs ÷ Machine hours

= $45,000 ÷ 100,000 machine hours

= $0.45

By dividing the Manufacturing overhead costs by the machine hours we can get the annual manufacturing overhead cost-allocation rate