Question

1. Determine the company's predetermined overhead application rate. (Round your answer to 2 decimal places.) 3. Determine the cost of jobs still in production as of March 31. (Round your answer to 2 decimal places.) Cost of the jobs in production 4. Did the finished-goods inventory increase or decrease during the first quarter? By how much? (DO not round intermediate calculations.) The finished-goods inventory by 5. Was manufacturing overhead under-or overapplied for the first quarter of the year? By how much? (Do not round intermediate calculations.) The overhead was for the first quarter of the year by Stellar Sound, Inc. which uses a job-order costing system, had two jobs in process at the start of 20x1: job no. 64 ($84,100) and job no. 65 ($53,400). The following information is available: a. The company applies manufacturing overhead on the basis of machine hours (based on practical capacity). Budgeted overhead and machine activity for the year were anticipated to be $808,000, and 16,000 hours, respectively. b. The company worked on four jobs during the first quarter. Direct materials used, direc labor incurred, and machine hours consumed were as follows: Direct Material $21,000 Job No. 64 65 66 67 Direct Labor $35,000 22,000 65,000 8,800 Machine Hours 1,200 700 2,000 500 44,000 15,000 c. Manufacturing overhead during the first quarter included charges for depreciation ($32,900), indirect labor ($60,100), indirect materials used ($5,000), and other factory costs ($139,500). d. Stellar Sound completed job no. 64 and job no. 65. Job no. 65 was sold on account, producing a profit of $34,800 for the firm.

Answer 1

			job 64	65	66	67
Beginning work in process			84,100	53,400			137,500
cost added during the year
Direct materials			21,000	0	44,000	15,000	80,000
direct labor			35,000	22,000	65,000	8,800	130,800
overhead applied			60600	35350	101000	25250	222200
total cost added during the ye			116,600	57350	210,000	49,050	433,000
total cost.			200,700	110,750	212,000	49,550	573,000
		overhead rate = 808000/16000
				50.5
Tran	General Journal				Debit	Credit
a.	work in process inventory				210,800
	raw materials inventory					80,000
	factory payroll					130,800
b.	manufacturing overhead				237,500
	accumulated depreciation					32,900
	Accounts payable (60,100+5000+139500)					204,600
c.	Work in process inventory				222200
	manufacturing overhead d					222200
d.	finished goods				311,450
	work in process inventory					313,350
e-2	cost of goods sold				110,750
	finished goods inventory					110,750
e-1	Account receivable				145,550
	sales (110,750+34800)					145,550
3)	cost of jobs still in production					261,550
	(job 66+67)
4)	the finished goods inventory			increased by		200,700
5)	manufacturing overhead incurred				237,500
	manufacturing overhead applied				-222,200
	overhead under applied				15,300
	the overhead was		underapplied		for the first Quarter of the year by				15,300