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Vintage Manufacturing uses a perpetual inventory system and predetermined manufacturing overhead rate based on direct labor cost. At the beginning of 2023, they estimated total manufacturing overhead costs at $2,352,000, and they estimated total direct labor cost at $3,360,000. The administration and selling overheads are to be absorbed in each job cost at 15% of prime cost. Distribution cost should be added to each job according to quotes from outside carriage companies. The entity wishes to quote for job # 242. Job stats are as follows: Direct materials cost Direct labour rate $175,250 $480 per direct labour hour 500 hours Direct labour hours Special Design Cost Distribution quote from haulage company Units of product produced $9,750 $24,250 250 cartons a) Compute Vintage Manufacturing predetermined manufacturing overhead rate for 2023. b) How much manufacturing overhead was allocated to Job #242? c) Calculate the total cost & quotation price of Job #242, given that a margin of 20% is applied. d) Calculate the production cost per unit (cost per carton) of finished product? e) Assuming that the quote was accepted by the customer, state the journal entries that would be necessary to record the production costs for Job#242.

Vintage Manufacturing uses a perpetual inventory system and predetermined manufacturing overhead rate based on direct labor cost. At the beginning of 2023, they estimated total manufacturing overhead costs at $2,352,000, and they estimated total direct labor cost at $3,360,000. The administration and selling overheads are to be absorbed in each job cost at 15% of prime cost. Distribution cost should be added to each job according to quotes from outside carriage companies. The entity wishes to quote for job # 242. Job stats are as follows: Direct materials cost Direct labour rate $175,250 $480 per direct labour hour 500 hours Direct labour hours Special Design Cost Distribution quote from haulage company Units of product produced $9,750 $24,250 250 cartons a) Compute Vintage Manufacturing predetermined manufacturing overhead rate for 2023. b) How much manufacturing overhead was allocated to Job #242? c) Calculate the total cost & quotation price of Job #242, given that a margin of 20% is applied. d) Calculate the production cost per unit (cost per carton) of finished product? e) Assuming that the quote was accepted by the customer, state the journal entries that would be necessary to record the production costs for Job#242.

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 9EB: The cost data for BC Billing Solutions for the year 2020 is as follows: Using the high-low method,...
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Vintage Manufacturing uses a perpetual inventory system and predetermined manufacturing overhead rate based on direct labor cost. At the beginning of 2023, they estimated total manufacturing overhead costs at $2,352,000, and they estimated total direct labor cost at $3,360,000. The administration and selling overheads are to be absorbed in each job cost at 15% of prime cost. Distribution cost should be added to each job according to quotes from outside carriage companies. The entity wishes to quote for job # 242. Job stats are as follows: Direct materials cost Direct labour rate $175,250 $480 per direct labour hour 500 hours Direct labour hours Special Design Cost Distribution quote from haulage company Units of product produced $9,750 $24,250 250 cartons a) Compute Vintage Manufacturing predetermined manufacturing overhead rate for 2023. b) How much manufacturing overhead was allocated to Job #242? c) Calculate the total cost & quotation price of Job #242, given that a margin of 20% is applied. d) Calculate the production cost per unit (cost per carton) of finished product? e) Assuming that the quote was accepted by the customer, state the journal entries that would be necessary to record the production costs for Job#242.
Transcribed Image Text:Vintage Manufacturing uses a perpetual inventory system and predetermined manufacturing overhead rate based on direct labor cost. At the beginning of 2023, they estimated total manufacturing overhead costs at $2,352,000, and they estimated total direct labor cost at $3,360,000. The administration and selling overheads are to be absorbed in each job cost at 15% of prime cost. Distribution cost should be added to each job according to quotes from outside carriage companies. The entity wishes to quote for job # 242. Job stats are as follows: Direct materials cost Direct labour rate $175,250 $480 per direct labour hour 500 hours Direct labour hours Special Design Cost Distribution quote from haulage company Units of product produced $9,750 $24,250 250 cartons a) Compute Vintage Manufacturing predetermined manufacturing overhead rate for 2023. b) How much manufacturing overhead was allocated to Job #242? c) Calculate the total cost & quotation price of Job #242, given that a margin of 20% is applied. d) Calculate the production cost per unit (cost per carton) of finished product? e) Assuming that the quote was accepted by the customer, state the journal entries that would be necessary to record the production costs for Job#242.
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