Question

then and drag to the Favorites Bar folder. Or import from another browser. Import favorites Saved At the beginning of the year, Custom Mfg. established its predetermined overhead rate by using the following cost predict overhead costs $900,000, and direct materials costs, $300,000. At year-end, the company's records show that actualov for the year are $1.632.800. Actual direct materials cost had been assigned to jobs as follows. Jobs completed and sold $420, eee Jobs in finished goods inventory 73,000 Jobs in work in process inventory 48,000 Total actual direct materials $541,000 cost 1. Determine the predetermined overhead rate. 2&3. Enter the overhead costs incurred and the amounts applied to jobs during the year using the predetermined overhead determine whether overhead is overapplied or underapplied. 4. Prepare the adjusting entry to allocate any over- or underapplied overhead to Cost of Goods Sold Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 and 3 Reg 4 Determine the predetermined overhead rate. Overhead Rate : Choose Denominator: Choose Numerator: Overhead Rate - Overhead rate Rea Reg 2 and 3 > Prev 1 of 1 !!! Next > to search

Answer 1

Predetermined overhead rate

Predetermined overhead rate = Estimated total overhead costs / Estimated total direct materials cost

= $900,000 / $300,000

= 300% of Direct material cost

“Hence, the Predetermined overhead rate will be 300% of Direct material cost”