Question

The following cost data relate to the manufacturing activities of Chang Company during the just completed year: 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 $ 15,500 135,000 8,500 75,000 230,700 10,500 $ 475,200 $ 405,000 $ 65,000 $ 20,500 $ 30,500 $ 40, 500 $ 70,500 The company uses a predetermined overhead rate of $24 per machine-hour to apply overhead cost to jobs. A total of 20,200 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

Answer 1

1
Actual Manufacturing overhead costs	475200
Manufacturing overhead applied	484800	=20200*24
Overapplied overhead cost	9600
2
Direct materials:
Raw materials inventory, beginning	20500
Add: Purchases of raw materials	405000
Raw materials available for use	425500
Less: Raw materials inventory, ending	30500
Raw materials used in production	395000
Less: Indirect materials	15500	379500
Direct labor		65000
Manufacturing overhead cost applied to work in process		484800
Total manufacturing costs		929300
Add: Work in process inventory, beginning		40500
		969800
Less: Work in process inventory, ending		70500
Cost of goods manufactured		899300