Mickley Companys predetermined overhead rate is 2300 per dir

Mickley Company’s predetermined overhead rate is $23.00 per direct labor-hour and its direct labor wage rate is $15.00 per hour. The following information pertains to Job A-500:

What is the total manufacturing cost assigned to Job A-500?

If Job A-500 consists of 30 units, what is the average cost assigned to each unit included in the job? (Round your answer to 2 decimal places.)

Solution

1.

Total direct labor-hours required for Job A-500:

Total Direct labor hours = Direct labor cost / Direct labor wage rate per hour

= $75 / 15

= 5

Total manufacturing cost assigned to Job A-500:

Direct material = 290

Direct labor = 75

Manufacturing overhead applied ($23 per DLH × 15 DLHs) = 345

Total Manufacturing cost = 710

2. Unit product cost for Job A-500:

= Total Manufacturing cost / Number of units in the job

= 710/30

= 23.67