J & J Products Uses Operational Costing In Addition,J & J Allocates Overhead Based on Direct Labour

question 53

Essay

J & J Products uses operational costing.One of their customers has requested 1000 units of an identical product.J & J estimates the following will be incurred to fulfil the customer order:
$\begin{array}{llcc} \text {Total direct materials } &\$2000\\ \text { Total direct labour hours } & \text { 50 hours}\\ \text {Direct lahnur cost mor hours } & \text { \$ 20 per hous } \\\end{array}$

In addition,J & J allocates overhead based on direct labour cost.At the beginning of this year,they estimated overhead costs would total $800 000 and direct labour would cost a total of $3 200 000.
Required:
A. What will be the predetermined cverhead rate used during the year?
B. What will be the tatal manufacturing casts for the above customer's arder?

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Definitions:

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