Reference no: EM132804727

Problem - ABC company follows a job-costing system at its Pune plant. The plant has a machining department and an assembly department. Its job costing system has two direct cost categories (direct materials and direct manufacturing labour) and two manufacturing overhead cost pools(the machining department overhead allocated to jobs based on actual machine hours and the assembly department overhead, allocated to jobs based on actual direct manufacturing labour cost). The 2012 budget for the plant is:

Required -

a. Compute the budgeted manufacturing overhead rate for each department.

b. During February the job cost record for job 647 contained the following:

Compute the total manufacturing overhead costs allocated to job 647.

c. At the end of 2012, the actual manufacturing overhead costs were Rs.21,00,000 in Machining department and Rs.37,00,000 in Assembly department. Assume that 55,000 actual machine hours were used in Machining and that actual direct manufacturing labour costs in Assembly were Rs.22,00,000. Compute the over or under allocated overheads for each department.