Copy Center pays an average wage of $13 per hour to employees for printing and copying jobs, and allocates $19 of overhead for each employee hour worked. Direct materials are assigned to each job according to actual cost. If Job M-47 used $375 of direct materials and took 15 direct labor hours of labor to complete, what is the total cost that should be assigned to the job?
Answered on
To find the total cost assigned to Job M-47, we can calculate it by summing up the direct materials cost, direct labor cost and allocated overhead cost.
Given:
Direct materials cost for Job M-47 = $375
Direct labor hours for Job M-47 = 15
Average wage per hour = $13
Overhead allocated per employee hour = $19
First, let's calculate the direct labor cost for Job M-47:
Direct Labor Cost = Direct Labor Hours × Average Wage per Hour
Direct Labor Cost = 15× $13
Direct Labor Cost = $195
Next, we find the total overhead cost allocated to Job M-47 based on the direct labor hours:
Overhead Cost = Direct Labor Hours × Overhead per Hour
Overhead Cost = 15×$19
Overhead Cost = $285
Now, let's sum up the direct materials cost, direct labor cost, and allocated overhead cost for Job M-47:
Total Cost for Job M-47 = Direct Materials Cost + Direct Labor Cost + Overhead Cost
Total Cost for Job M-47 = $375 + $195 + $285
Total Cost for Job M-47 = $855
Therefore, the total cost that should be assigned to Job M-47 is $855.