Lucas Industries uses departmental overhead rates to allocate its manufacturing overhead to jobs. The company has two departments: Assembly and Sanding. The Assembly Department uses a departmental overhead rate of $50 per machine hour, while the Sanding Department uses a departmental overhead rate of $25 per direct labor hour. Job 603 used the following direct labor hours and machine hours in the two departments: Actual results Assembly Department Sanding Department Direct labor hours used 7 5 Machine hours used 11 6 The cost for direct labor is $25 per direct labor hour and the cost of the direct materials used by Job 603 is $1,600. How much manufacturing overhead would be allocated to Job 603 using the departmental overhead rates?

The Assembly Department uses a rate of $50 per machine hour and Job 603 took 11 machine hours, so it would be $550 while the Sanding Department uses an overhead rate of of $25 per direct labor hour and Job 603 used 5 labor hours so it would be $125.

Assembly Department overhead $550

+

Sanding Department overhead $125

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Total overhead $675