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Question - National Marketing Corp. uses a job-order costing system. It has three production departments, X, Y and Z.
The manufacturing cost budget for 2011 is as follows:
Dept. X
Dept. Y
Dept. Z
Direct Materials
P600,000
P400,000
P200,000
Direct Labor
200,000
500,000
400,000
Manufacturing overhead
600,000
100,000
For Job no. 01-90 which was completed in 2011, direct materials cost was P75,000 and direct labor was as follows:
Dept. X P40,000
Dept. Y 100,000
Dept. Z 20,000
The corporation applies manufacturing overhead to each job order on the basis of direct labor cost, using departmental rates predetermined at the beginning of the year based on the manufacturing cost budget.
Required - What the total manufacturing cost of Job No. 01-90 which was completed in 2011?
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