Reference no: EM132578186

Question - Bob's Electronics Inc. manufactures high-tech screens for computers. In June, the two production departments had budgeted allocation bases of 8,000 machine hours in Department 1 and 5,500 direct manufacturing labour hours in Department 2. The budgeted manufacturing overheads for the month were $32,000 and $27,500, respectively. For Job 101, the actual costs incurred in the two departments were as follows:

Department 1 Department 2

Direct materials purchased on account $66,000 $106,500

Direct materials used 12,500 9,100

Direct manufacturing labour 32,500 32,200

Indirect manufacturing labour 6,600 5,400

Indirect materials used 4,500 2,850

Lease on equipment 9,750 2,250

Utilities 600 750

Job 101 incurred 1,100 machine hours in Department 1 and 400 manufacturing labour hours in Department 2. The company uses a budgeted departmental overhead rate for applying overhead to production.

Required -

1. What is the budgeted indirect cost allocation rate for Department 1?

2. What is the budgeted indirect cost allocation rate for Department 2?

3. What is the total cost assigned to Job 101 based on normal costing?