Business, 29.01.2021 17:10 kaitietrueman8823

Landen Corporation uses a job-order costing system. At the beginning of the year, the company made the following estimates: Direct labor-hours required to support estimated production 145,000
Machine-hours required to support estimated production 72,500
Fixed manufacturing overhead cost $406,000
Variable manufacturing overhead cost per direct labor-hour $4.40
Variable manufacturing overhead cost per machine-hour $8.80
During the year, Job 550 was started and completed. The following information is available with respect to this job:
Direct materials $195
Direct labor cost $288
Direct labor-hours 15
Machine-hours 5
Required:
1. Assume that Landen has historically used a plantwide predetermined overhead rate with direct labor-hours as the allocation base. Under this approach:
A. Compute the plantwide predetermined overhead rate.
B. Compute the total manufacturing cost of Job 550.
C. If Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550?
2. Assume that Landen’s controller believes that machine-hours is a better allocation base than direct labor-hours. Under this approach:
A. Compute the plantwide predetermined overhead rate.
B. Compute the total manufacturing cost of Job 550.
C. If Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550?

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Landen Corporation uses a job-order costing system. At the beginning of the year, the company made t...

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