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.)
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.) |
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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