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Applying Overhead Cost; Computing Unit Product Cost [LO2-2, LO2-3]

Newhard Company assigns overhead cost to jobs on the basis of 112% of direct labor cost. The job cost sheet for Job 313 includes $17,738 in direct materials cost and $10,100 in direct labor cost. A total of 1,350 units were produced in Job 313.

Required:

a. What is the total manufacturing cost assigned to Job 313?

b. What is the unit product cost for Job 313?

Answer :

a. The total manufacturing cost assigned to Job 313 is $31,486.
b. The unit product cost for Job 313 is $23.32 per unit.


a. To calculate the total manufacturing cost assigned to Job 313, we need to determine the overhead cost. Since the overhead cost is 112% of the direct labor cost, we can calculate it by multiplying the direct labor cost ($10,100) by 112% (or 1.12). Therefore, the overhead cost is $11,312 (10,100 * 1.12). The total manufacturing cost is the sum of the direct materials cost, direct labor cost, and overhead cost. Thus, the total manufacturing cost assigned to Job 313 is $17,738 + $10,100 + $11,312 = $31,486.

b. The unit product cost for Job 313 is obtained by dividing the total manufacturing cost by the number of units produced. Dividing $31,486 by 1,350 units gives a unit product cost of approximately $23.32 per unit.

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