The Lulu Company uses a normal job-costing system at its Minneapolis plant. The plant has a machining department and an assembly department. Its job-costing system has two direct-cost categories (direct materials and direct manufacturinglabor) and two manufacturing overhead cost pools (the machining department overhead, allocated to jobs based on actual machine-hours, and the assembly department overhead, allocated to jobs based on actual direct manufacturing laborcosts). The 2014 budget for the plant is as follows:

	Machining Department	Assembly Department
Manufacturing overhead	$1,500,000	$5,100,000
Direct manufacturing labor costs	$1,600,000	$3,000,000
Direct manufacturing labor-hours	160,000	220,000
Machine-hours	30,000	220,000

Enter the formula, then enter the budgeted manufacturing overhead and cost allocation bases to solve for the budgeted manufacturing overhead rate for each department. (Enter the percentage result as a whole percentage. Abbreviations used: manuf. = manufacturing, DM = direct manufacturing.)

/

=

Budgeted manufacturing overhead rate

Machining		/		=
Assembly		/		=

Requirement 1. Review the February job-cost record for Job 494 . Compute the total manufacturing overhead costs allocated to Job 494. (Abbreviations used: MOH = manufacturing overhead.) Enter the formula to calculate the manufacturing overhead to allocate to a job and compute the total manufacturing overhead costs allocated to Job 494.

x

=

MOH allocated to job

Machining overhead		x		=
Assembly overhead	$50	x		=
Total manufacturing costs allocated to job 494

Requirement 2. At the end of 2014, the actual manufacturing overhead costs were $2,200,000 in machining and $5,300,000in assembly. Assume that 35,000 actual machine-hours were used in machining and that actual direct manufacturing labor costs in assembly were $3,100,000.

Compute the over- or underallocated manufacturing overhead for each department.

Enter the formula and compute the over- or underallocated manufacturing overhead for the year for each department. (Use parentheses or a minus sign to report manufacturing overhead overallocated. Abbreviations used: manuf. = manufacturing.)

=

Underallocated (Overallocated)

Machining				=
Assembly				=