Question

Use the information below to answer the following question 15 and 16 ac is a manufacturering job order costing solving mufacturing overhead (MOH) based on direct labor cos (DCT, A e catrocent period, the Work la Process inventory condo falance of 518,000. The data helow reflects the job cos secs of the only jobs not yet complete: EN 15.000 Direct Material 6,000 $ 3,000 = 600 = 15,000 Direct Labor 4.000 2.000 ,00 73000 Additional financial information related to the period is as follows: Poule Toft 3000.-0.5 Estimated Actual Direct Labor Cost s ? $ 137,000 Manufacturing OH 65.000 66,500 Unadjasted COGS 411,000 TOUR MOH hoft = DL 6,00005 (*) 0.5 100 9.5X = 35.000 0.5 0.5 x=130.000 IS At the beginning of the period, direct labor cost was estimated to be A 5 32.500 $ 110.000 C S 133.000 D. S 135.500 E None of the above 16 Ir the company closes out over AS 413.000 HS 412,500 © $ 409,000 409.500 E None of the above under applied MOR COGS, the adjusted COGS balance at the end of the period would be App tot Poule Achan LH 0.x 137000 = 68,500 Metud toot -66,500 2,009 - her C065 All,000 2000 CV 405,000 WIP 16D

Answer 1

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Workings for Answer 15:
Calculation of manufacturing overhead rate:
	Job 843	Job 641	Total	Note
Work in Process			18,000.00
Less:
Direct Materials	6,000.00	3,000.00	9,000.00
Direct Labor	4,000.00	2,000.00	6,000.00	B
Manufacturing overhead			3,000.00	C
Manufacturing overhead rate			50.00%	D=C/B
Answer 15			Amount $
Estimated Manufacturing overhead			65,000.00	E
Manufacturing overhead rate			50.00%	See D
Estimated Direct Labor			130,000.00	F=E/D
Answer 16			Amount $
Actual Manufacturing overhead			66,500.00
Less: Estimated Manufacturing overhead			65,000.00
Under applied Manufacturing overhead			1,500.00	G

As the Manufacturing overhead is under applied so if adjusted to COGS it will increase and adjusted COGS will be:

			Amount $
Unadjusted COGS			411,000.00
Add: Under applied Manufacturing overhead			1,500.00	See G
Adjusted COGS			412,500.00
SO answer is option B.