Bolander Corporation uses a job-order costing system with a single plantwide pre

Question

Bolander Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on the following data: Total machine-hours Total fixed manufacturing overhead cost 70,000 $294,000 variable manufacturing overhead per machine-2.30 hour Recently, Job M825 was completed with the following characteristics: Number of units in the job Total machine-hours Direct materials Direct labor cost 20 80 $ 665 $1,840 The unit product cost for Job M825 is closest to: (Round your intermediate calculations to 2 decimal places.) Multiple Choice $37.81 $59 25 5151.25 $125.25

Explanation / Answer

Single plantwide overhead rate = 294000/70000 = 4.20+2.30 = 6.50 per machine hour

Manufacturing cost = 665+1840+(80*6.50) = 3025

Unit product cost = 3025/20 = 151.25

so answer is c) $151.25

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