Sweeten Company had no jobs in progress at the beginning of

Sweeten Company had no jobs in progress at the beginning of March and no beginning inventories. The company has two manufacturing departments--Molding and Fabrication. It started, completed, and sold only two jobs during March Job P and Job Q. The following additional information is available for the company as a whole and for Jobs P and Q (all data and questions relate to the month of March) Molding Fabrication Total 4,000 $12,250 $16,350 $28, 600 2,500 Estimated total machine-hours used Estimated total fixed manufacturing overhead Estimated variable manufacturing overhead per machine-hour 1,500 $ 2.30 3.10 Job Q $22,000 $12,500 $28,200 $11,100 Job P Direct materials Direct labor cost Actual machine-hours used: Molding Fabrication Total 2,600 1,500 4,100 1,700 1,800 3,500 Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month Required: For questions 1-8, assume that Sweeten Company uses a plantwide predetermined overhead rate with machine-hours as the allocation base. For questions 9-15, assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments Foundational 2-4 4. If Job P included 20 units, what was its unit product cost? (Do not round intermediate calculations. Round your final answer to nearest whole dollar.)

Solution

4. If Job P included 20 units, then its unit product cost is $4508.75 as shown below.

Predetermined Overhead Rate = Estimated Fixed Overhead/Estimated Direct Labor Hours + Variable Overhead Rate Per Hour

Estimated total overhead = Estimated total fixed manufacturing overhead ($28,600) + variable overhead molding (machine hours:2500*var overhead per machine hour molding:$2.3) + variable overhead fabrication (machine hours:1500*var overhead per machine hour fabrication:$3.10 = 28600+ 5750 + 4650 = 39000

Plantwide predetermined rate = estimated total overhead (39000)\\estimated total machine hours (4000) = 9.75

Manufacturing overhead = direct materials + direct labor + (predetermine overhead rate*machine hours)

Job P = overhead rate * total machine hours = 9.75(previous solution) * 4100 = $39,975

Total manufacturing cost = direct materials + direct labor + manufacturing overhead (previous solution) = 22,000 + 28200 + 39975 =$90175

Unit product cost = total manufacturing cost \\ total units = 90175 \\ 20 = $4508.75