Question

Job 593 was recently completed. The following data have been recorded on its job cost sheet:

Direct materials $3,190
Direct labor-hours 71 labor-hours
Direct labor wage rate $15 per labor-hour
Machine-hours 175 machine-hours


The Corporation applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $14 per machine-hour. The total cost that would be recorded on the job cost sheet for Job 593 would be:
a.$6,705
b.$3,219
c.$5,249
d.$4,255

Answer 1

a.$6,705

Step-by-step explanation:

The total cost is the sum of the three cost component, Direct materials, direct labours, and factory overhead.

Direct Labor Cost: 71 hours x $15 per hour = $ 1,065

Manufacturing Overhead: 175 machine hours x $14 per hour = $ 2,450

Direct Materials $ 3,190

Total cost: 1,065 + 2,450 + 3,190 = 6,705