1 | Predetermined Overhead Rate = Estimated total manufacturing overhead cost / Estimated total amount of allocation base |
= $113,100 / $87,000 * 100 | |
= 130.00% |
2. Before the underapplied or overapplied overhead can be computed, we must determine the amount of direct materials used in production for the year :
Raw materials inventory, beginning | $ 24,000 | |
Add, Purchases of raw materials | $ 140,000 | |
Raw materials available | $ 164,000 | |
Deduct: Raw materials inventory, ending | $ 16,000 | |
Raw materials used in production | $ 148,000 | |
Actual manufacturing overhead costs: | ||
Indirect labor | $ 116,000 | |
Property taxes | $ 8,900 | |
Depreciation of equipment | $ 17,000 | |
Maintenance | $ 12,000 | |
Insurance | $ 8,300 | |
Rent, building | $ 35,000 | |
Total actual costs | $ 197,200 | |
Applied manufacturing overhead costs: | ||
$148,000 × 130% | $ 192,400 | |
Underapplied overhead | $ 4,800 | ($197,200 - $192,400) |
3.
Gitano Products | ||
Schedule of Cost of Goods Manufactured | ||
Direct materials: | ||
Raw materials inventory, beginning | $ 24,000 | |
Add purchases of raw materials | $ 140,000 | |
Total raw materials available | $ 164,000 | a + b |
Deduct raw materials inventory, ending | $ 16,000 | |
Raw materials used in production | $ 148,000 | c - d |
Direct labor | $ 83,000 | |
Manufacturing overhead applied to work in process | $ 192,400 | ($148,000 * 130%) |
Total manufacturing costs | $ 423,400 | e + f + g |
Add: Work in process, beginning | $ 48,000 | |
$ 471,400 | h + i | |
Deduct: Work in process, ending | $ 39,000 | |
Cost of goods manufactured | $ 432,400 | j - k |
4.
Gitano Products | |||
Schedule of Cost of Goods Sold | |||
a | Finished goods inventory, beginning | $ 71,000 | |
b | Add: Cost of goods manufactured | $ 432,400 | |
c | Goods available for sale | $ 503,400 | a + b |
d | Deduct: Finished goods inventory, ending | $ 60,000 | |
e | Cost of goods sold | $ 443,400 | c - d |
4. The amount of overhead cost in Work in Process was: $8,000 direct materials cost × 130% = $10,400
The amount of direct labor cost in Work in Process is: | ||||
a | Total ending work in process | $ 39,000 | ||
b | Deduct: Direct materials | $ 8,000 | ||
Manufacturing overhead | $ 10,400 | $ 18,400 | ||
d | Direct labor cost | $ 20,600 | a - b |
The completed schedule of costs in Work in Process was: | |
Direct materials | $ 8,000 |
Direct labor | $ 20,600 |
Manufacturing overhead | $ 10,400 |
Work in process inventory | $ 39,000 |
Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct material...
Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $800,000 of manufacturing overhead for an estimated allocation base of $500,000 direct material dollars to be used in production. The company has provided the following data for the just completed year: $ 510,000 $ 90,000 Purchase of raw...
Gitano Products operates a job-order costing system and applies
overhead cost to jobs on the basis of direct materials used in
production (not on the basis of raw materials
purchased). Its predetermined overhead rate was based on a cost
formula that estimated $118,300 of manufacturing overhead for an
estimated allocation base of $91,000 direct material dollars to be
used in production. The company has provided the following data for
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Purchase of raw materials
$
135,000
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Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $123,200 of manufacturing overhead for an estimated allocation base of $88,000 direct material dollars to be used in production. The company has provided the following data for the just completed year: $ 139,000 $ 84,000 Purchase of raw...
Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $111,800 of manufacturing overhead for an estimated allocation base of $86,000 direct material dollars to be used in production. The company has provided the following data for the just completed year: $ 133,000 $ 82,000 Purchase of raw...
Gitano Products operates a job-order costing system and applies
overhead cost to jobs on the basis of direct materials used in
production (not on the basis of raw materials
purchased). Its predetermined overhead rate was based on a cost
formula that estimated $130,200 of manufacturing overhead for an
estimated allocation base of $93,000 direct material dollars to be
used in production. The company has provided the following data for
the just completed year:
Purchase of raw materials
$
137,000
Direct...
Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $126,000 of manufacturing overhead for an estimated allocation base of $90,000 direct material dollars to be used in production. The company has provided the following data for the just completed year $ 130,000 $ 86,000 Purchase of raw...
Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $111.800 of manufacturing overhead for an estimated allocation base of $86,000 direct material dollars to be used in production. The company has provided the following data for the just completed year. $ 134,000 $ 82,000 Purchase of raw...
Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $121,800 of manufacturing overhead for an estimated allocation base of $87,000 direct material dollars to be used in production. The company has provided the following data for the just completed year: $ 134,000 $ 83,000 Purchase of raw...
Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $119,000 of manufacturing overhead for an estimated allocation base of $85,000 direct material dollars to be used in production. The company has provided the following data for the just completed year: $ 134,000 $ 81,000 Purchase of raw...
Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $111,800 of manufacturing overhead for an estimated allocation base of $86,000 direct material dollars to be used in production. The company has provided the following data for the just completed year: Purchase of raw materials $ 136,000 Direct...