Kostelnik Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on total fixed manufacturing overhead cost of $481,900, variable manufacturing overhead of $3.00 per machine-hour, and 79,000 machine-hours. The company has provided the following data concerning Job A496 which was recently completed:Number of units in the job 20Total machine-hours 80Direct materials $ 870Direct labor cost $1,740The unit product cost for Job A496 is closest to: (Round your intermediate calculations to 2 decimal places.)

Unitary cost= $167.35

Explanation:

Giving the following information:

The company based its predetermined overhead rate for the current year on total fixed manufacturing overhead cost of $481,900, variable manufacturing overhead of $3.00 per machine-hour, and 79,000 machine-hours.

Job A496:

Number of units in the job 20

Total machine-hours 80

Direct materials $ 870

Direct labor cost $1,740

First, we need to calculate the estimated manufacturing overhead rate we need to use the following formula:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= (481,900/79,000) + 3= $9.1 per machine hour

Now, we need to calculate the total cost per unit:

Unitary cost= direct material + direct labor + allocated overhead

Unitary cost= (879/20) + (1,740/20) + (80*9.1)/20= $167.35

answer; the correct answer to the above statement is (true);