The company uses a job-order costing system in which departmental predetermined overhead rates are used to apply manufacturing overhead cost to jobs. the predetermined overhead rate in the molding department is based on machine-hours, and the rate in the painting department is based on direct labor-hours. at the beginning of the year, the company provided the following estimates:
department
molding painting
direct labor-hours 12,000 60,000
machine-hours 70,000 8,000
fixed manufacturing overhead cost $ 497,000 $ 615,000
variable manufacturing overhead per machine-hour $ 1.50 -
variable manufacturing overhead per direct labor-hour - $ 2.00
job 205 was started on august 1 and completed on august 10. the company's cost records show the following information concerning the job:
department
molding painting
direct labor-hours 30 84
machine-hours 110 20
direct materials $ 770 $ 1,332
direct labor cost $ 525 $ 1,470
required:
(1) compute the predetermined overhead rates used in the molding department and the painting department.
(2) compute the total overhead cost applied to job 205.