Job 910 was recently completed. The following data have been recorded on its job cost sheet: Direct materials $ 2,428 Direct labor-hours 75 labor-hours Direct labor wage rate $ 20 per labor-hour Machine-hours 132 machine-hours The Corporation applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $21 per machine-hour. The total cost that would be recorded on the job cost sheet for Job 910 would be:

a. $3,928

b. $7,540

c. $4,024

d. $6,700

The correct answer is D.

Explanation:

Giving the following information:

Direct materials $ 2,428

Direct labor-hours 75 labor-hours

Direct labor wage rate $ 20 per labor-hour

Machine-hours 132 machine-hours

The Corporation applies manufacturing overhead based on machine-hours. The predetermined overhead rate is $21 per machine-hour.

To calculate the total cost, first, we need to calculate the cost of direct labor and allocated overhead:

direct labor = 75 hours * $20 = $1,500

Allocated overhead = Estimated manufacturing overhead rate * Actual amount of allocation base

Allocated overhead = $21*132 = $2,772

Now, we can calculate the total cost:

Total cost = direct material + direct labor + manufacturing overhead

Total cost = 2,428 + 1,500 + 2,772 = $6,700