EXERCISE 3-12 Applying Overhead; Cost of Goods Manufactured [LO3-2, L03-6, LO3-7] The following cost data relate to the manufacturing activities of Chang Company during the just completed year: $ 15,000 130,000 8,000 70,000 240,000 10,000 $473,000 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 ...... $400,000 $60,000 $20,000 $30,000 $40,000 $70,000 The company uses a predetermined overhead rate to apply overhead cost to jobs. The rate for the year was $25 per machine-hour. A total of 19,400 machine-hours was recorded for 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.
Related questions
The following cost data relate to the manufacturing activitiesof Chang Company during the just completed year: |
| Manufacturingoverhead costs incurred: | ||
| Indirect materials | $ | 15,800 |
| Indirect labor | 138,000 | |
| Property taxes,factory | 8,800 | |
| Utilities, factory | 78,000 | |
| Depreciation,factory | 150,600 | |
| Insurance, factory | 10,800 | |
| Total actualmanufacturing overhead costs incurred | $ | 402,000 |
| Other costsincurred: | ||
| Purchases of rawmaterials (both direct and indirect) | $ | 408,000 |
| Direct labor cost | $ | 68,000 |
| Inventories: | ||
| Raw materials,beginning | $ | 20,800 |
| Raw materials,ending | $ | 30,800 |
| Work in process,beginning | $ | 40,800 |
| Work in process,ending | $ | 70,800 |
The company uses a predetermined overhead rate to apply overheadcost to jobs. The rate for the year was $20 per machine-hour. Atotal of 20,500 machine-hours was recorded for the year. |
| 1.Compute the amount of underapplied or overapplied overheadcost for the year.
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The following cost data relate to the manufacturing activitiesof Black Company during the just completed year: |
| Manufacturingoverhead costs: | ||
| Property taxes,factory | $ | 3,000 |
| Utilities, factory | 5,000 | |
| Indirect labor | 10,000 | |
| Depreciation,factory | 24,000 | |
| Insurance, factory | 6,000 | |
| Total actualmanufacturing overhead costs | $ | 48,000 |
| Other costsincurred: | ||
| Purchases of rawmaterials | $ | 32,000 |
| Direct labor cost | $ | 40,000 |
| Inventories: | ||
| Raw materials,beginning | $ | 8,000 |
| Raw materials,ending | $ | 7,000 |
| Work in process,beginning | $ | 6,000 |
| Work in process,ending | $ | 7,500 |
The company uses a predetermined overhead rate to apply overheadcost to jobs. The rate for the year was $5 per machine-hour; atotal of 10,000 machine-hours was recorded for the year. All rawmaterials ultimately become direct materialsânone are classified asindirect materials. |
| Required: |
| 1. | Compute the amount of underapplied or overapplied overhead costfor the year. |
| 2. | Prepare a schedule of cost of goods manufactured for the yearusing the indirect method. (Enter all deductions as anegative.) |
