Question

1 and 2 required

The following cost data relate to the manufacturing activities of Chang Company during the just completed year: $ 15,900 139,000 8,900 79,000 150,300 10,900 $ 404,000 Manufacturing 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 process, ending $409,000 $ 69,000 $ 20,900 $ 30,900 $ 40,900 $ 70,900 The company uses a predetermined overhead rate of $20 per machine-hour to apply overhead cost to jobs. A total of 20,600 machine-hours were used during the year. Required: 1. Compute the amount of underapplied or overapplied overhead cost fodthe 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 Compute the amount of underapplied or overapplied overhead cost for the year. overhead cost Panulond 2 >

Answer 1

compute the amount of under or over applied manufacturing overhead cost for the year. Manufacturing Overhead applied Pre-determined Overhead rafe X Machine hours = $20 per machine X 20,600 Machine hour hours = $ 412000 Actual manufacturing overhead = $404000 Here manufacturing overhead applied is more than Actual manufacturing overhead So, Overhead is over applied - (-) Over applied overhead Manufacturing overhead applied Actual manufacturing overhead - $412000 (-) $ 404000 = $ 8000 Over applied overhead -> $8000

2. Prepare a schedule of cost of goods manufactured for the year. particular Direct materjal: $ 20900 Raw materials inventory, beginning Add: purchase of raw materials $409000 Raw materials available for use $429900 less: Raw material inventory, $ 30900 Ending Raw materials used in production $ 399000 less! Indirect materials $ 15900 Add: Direct labour $383100 $ 69000 $ 412000 Add: Manufacturing overhead cost applied to coork in process C B 2020600) Total manufacturing costs Add: work in process, beginning $86H100 $40900 less: work in proren, Ending $905000 $ 70900 Cost of goods manufactured $834100