Final answer:
The cost of Job A2 for the Mannitou Company is calculated by applying the overhead rate to the machine hours used by the job. With an overhead rate of $3 per machine hour and 2,000 machine hours used, the overhead is $6,000. This amount is added to the job's prime costs of $57,000 for a total cost of $63,000.
Step-by-step explanation:
To determine the cost of Job A2 for the Mannitou Company, we need to apply the factory overhead to the job based on machine hours. According to the provided information, Mannitou Company predicted factory overhead costs of $300,000 for 100,000 machine hours, which gives us an overhead rate of $3 per machine hour ($300,000 / 100,000 hours = $3 per machine hour).
Job A2 used 2,000 machine hours, therefore, we can calculate the overhead applied to Job A2 by multiplying the number of machine hours by the overhead rate (2,000 hours x $3 = $6,000). To find the total cost of Job A2, we add this overhead to the job's prime costs, which are already given as $57,000. Therefore, the total cost for Job A2 is $57,000 (prime costs) + $6,000 (overhead) = $63,000.