Asked by victoria burgos on May 29, 2024
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Lotz Corporation has two manufacturing departments--Casting and Finishing.The company used the following data at the beginning of the year to calculate predetermined overhead rates: During the most recent month, the company started and completed two jobs--Job F and Job K.There were no beginning inventories.Data concerning those two jobs follow: Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments.Further assume that the company uses a markup of 50% on manufacturing cost to establish selling prices.The calculated selling price for Job F is closest to:
A) $30,220
B) $90,660
C) $60,440
D) $96,100
Departmental Predetermined Overhead Rates
Overhead rates calculated for specific departments within a manufacturing facility, reflecting the unique costs associated with each department's operations.
Machine-Hours
A measure of the time machines are used in the production process, often used as a basis for allocating overhead costs in a manufacturing environment.
Markup
The amount added to the cost price of goods to cover overhead and profit, expressed as a percentage of the cost.
- Determine the selling price of jobs based on manufacturing cost and markup.
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Learning Objectives
- Determine the selling price of jobs based on manufacturing cost and markup.
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