Reference no: EM132500842

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

Estimated total machine-hours used               2,500                     1,500                              4,000

Estimated total fixed manufacturing overhead  $10,000                     $15,000                            $25,000

Estimated variable manufacturing overhead per machine-hour $1.40      $2.20

                                                                      Job P                                            Job Q

Direct materials                                   $13,000                                $8,000

Direct labor cost                                   $21,000                                  $7,500

Actual machine-hours used:

Molding                                                 1,700                                       800

Fabrication                                                600                                   900

Total                                                        2,300                              1,700

• Sweeten Company had no underapplied or overapplied manufacturing overhead costs during the month.

Required:

Question 1: Assume that Sweeten Company uses a plantwide predetermined overhead rate with machine-hours as the allocation base.

Question 2: Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments.

Question 3: Assume that Sweeten Company used cost-plus pricing (and a markup percentage of 80% of total manufacturing cost) to establish selling prices for all of its jobs. What selling price would the company have established for Jobs P and Q? What are the selling prices for both jobs when stated on a per unit basis assuming 20 units were produced for Job P and 30 units were produced for Job Q?