Question

Fairfield company applies manufacturing overhead to products at a predetermined rate of $42 per direct labor hour. Its actual manufacturing costs for the most recent period are summarized here: Total Cost $ 86,000 26,000 Item Description Direct materials Used on Jobs 101 and 102 Indirect materials Used on multiple jobs Hourly labor wages 750 hours @ $22 per hour 200 hours for Job 101 - $ 4,400 300 hours for Job 102 - 6,600 250 hours for Job 103 = 5,500 Factory supervision Production engineer Factory janitorial work Selling, general, and administrative salaries Other manufacturing overhead costs (factory rent, insurance, depreciation, etc.) Other selling, general, and administrative costs (office rent, insurance, depreciation, etc.) 16,500 3,200 7,200 1,700 8, 200 6,700 5,200 Compute over- or underapplied manufacturing overhead. Complete this question by entering your answers in the tab below. There is only one question in the quiz. Required Compute over- or underapplied manufacturing overhead. Manufacturing Overhead

Answer 1

1) MANUFACTURING OVERHEAD :

Particular	Amount	Particular	Amount
Indirect Material	26000
Factory Supervision	3200	Applied Overhead (750*42)	31,500
Production engineer	7200
Factory janitorial work	1700
Other manufacturing overhead	6700
	44,800

2) COMPUTE OVER OR UNDER APPLIED MANUFACTURING OVERHEAD

Under Applied overhead = Actual Overhead-Applied overhead

                                   = 44800-31500

Under Applied Overhead = 13,300