Total Production Cost

cheddahcheese

New member
Joined
Mar 28, 2010
Messages
1
Hi Guys,

I need some help. I'm not sure if I am doing this problem correctly.

Question:
A job has prime cost of $270. It uses 10 machine hours in Department 1 and 15 direct labor hours in Department 2. Calculate the total product cost for the job.

*I calculated Dept. 1 overhead rate as $6. Dept. 2 overheard rate as $2. I know these are right.

So what I did for Dept 1:

10 hrs x 6 = $60

For Dept 2:
15 hrs x 2 = $30

Total product cost = $270 (prime cost) + $90 (total overhead?) = $360.

Is this the correct way to do this problem?
 
Looks ok. Sure seems like a silly question by your teacher...
What grade are you in?
 
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