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 $12.00 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 80 units, what is the average cost assigned to each unit included in the job? (Round your answer to 2 decimal places.)

Solution

Total hours worked=($120/$12)=10 hours.

Hence total overheads=(10*23)=$230

a. total manufacturing cost assigned to Job A-500=direct materials+direct labor+overheads

=(200+120+230)=$550.

b.average cost assigned to each unit included in the job=($550/80 units)

which is equal to

=$6.88(Approx).