Question

The following cost data relate to the manufacturing activities of Chang Company during the just completed year. Hanul acturing overhead costs incurred Indirect materials Indirect labor Property taxes, factory Utilities, factory Depreciation factory Insurance, factory Total actual manufacturing overhead costs incurred Other costs incurred: Purchases of raw materials (both direct and indirect) Direct labor cost Inventories: Raw materials, beginning Raw materials, ending Work in process, beginning work in processending 16,890 140,00 9.000 se, Bee 251,500 11.000 507,50 5.410, $ 70,00 $ 21,00 5 31.080 41, 5 21, The company uses a predetermined overhead rate of $25 per machine hour to apply overhead cost to jobs. A total of 20,700 machine-hours were used during the year Required: 1. Compute the amount of underapplied or overapplied overhead cost for the year 2. Prepare a schedule of cost of goods manufactured for the year Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a schedule of cost of goods manufactured for the year. Chang Company Schedule of cost of Goods Manufactured

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Answer 1

1.) Overapplied overhead cost $10,000 Chang Company Schedule Cost of goods Manufactured Schedule Direct Material: Raw Material inventory beginning $ 21,000 Add: Purcahse of Raw materials $ 410,000 Total Raw materials available $ 431,000 Less: Raw materials inventory ending $ 31,000 Raw Materials used in production $ 400,000 Less: Indirect Materials $ 16,000 Direct Labour Manufacturing overhead cost applied to work in process Total Manufacturing Costs Add: Work in process inventory Beginning Total Work in Process inventory Less: work in process inventory Ending Cost of goods Manufactured $ 384,000 $ 70,000 $ 517,500 $ 971,500 $ 41,000 $ 1,012,500 $ 71,000 $ 941,500 $ 507,500 Working Notes : Actuval Manufacturing Overhead Manufacturing Overhead applied (20,700*$25) overapplied overhead Cost $ S 517,500 10,000