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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.

2.

Prepare a schedule of cost of goods manufactured for theyear.

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Beverley Smith
Beverley SmithLv2
28 Sep 2019

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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 materials—none 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.)

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.

The following cost data relate to the manufacturing activitiesof Chang Company during the just completed year: Manufacturingoverhead costs incurred: Indirect materials $ 16,100 Indirect labor141,000 Property taxes, factory 9,100 Utilities, factory 81,000Depreciation, factory 149,700 Insurance, factory 11,100 Totalactual manufacturing overhead costs incurred $ 408,000 Other costsincurred: Purchases of raw materials (both direct and indirect) $411,000 Direct labor cost $ 71,000 Inventories: Raw materials,beginning $ 21,100 Raw materials, ending $ 31,100 Work in process,beginning $ 41,100 Work in process, ending $ 71,100 The companyuses a predetermined overhead rate of $20 per machine-hour to applyoverhead cost to jobs. A total of 20,800 machine-hours were usedduring the year. Required: 1. Compute the amount of underapplied oroverapplied overhead cost for the year. 2. Prepare a schedule ofcost of goods manufactured for the year.

Dillon Products manufactures various machined parts to customerspecifications. The company uses a job-order costing system andapplies overhead cost to jobs on the basis of machine-hours. At thebeginning of the year, the company used a cost formula to estimatethat it would incur $4,305,000 in manufacturing overhead cost at anactivity level of 574,000 machine-hours.

The company spent the entire month of January working on a largeorder for 12,500 custom-made machined parts. The company had nowork in process at the beginning of January. Cost data relating toJanuary follow:

Raw materials purchased on account, $313,000.

Raw materials used in production, $264,000 (80% direct materialsand 20% indirect materials).

Labor cost accrued in the factory, $171,000 (one-third directlabor and two-thirds indirect labor).

Depreciation recorded on factory equipment, $63,600.

Other manufacturing overhead costs incurred on account,$86,000.

Manufacturing overhead cost was applied to production on thebasis of 40,630 machine-hours actually worked during the month.

The completed job for 12,500 custom-made machined parts wasmoved into the finished goods warehouse on January 31 to awaitdelivery to the customer. (In computing the dollar amount for thisentry, remember that the cost of a completed job consists of directmaterials, direct labor, and applied overhead.)

Required:

1. Prepare journal entries to record items (a) through (f) above[ignore item (g) for the moment].

2. Prepare T-accounts for Manufacturing Overhead and Work inProcess. Post the relevant items from your journal entries to theseT-accounts.

3. Prepare a journal entry for item (g) above.

4. If 10,500 of the custom-made machined parts are shipped tothe customer in February, how much of this job’s cost will beincluded in cost of goods sold for February?

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