3 The following cost data relate to the manufacturing activities of Chang Compan

Question

3 The following cost data relate to the manufacturing activities of Chang Company during the just completed year Manufacturing overhead costs incurred: 15 points Indirect materials Indirect labor Property taxes, factory Utilities, factory Depreciation, factory Insurance, factory Total actual manufacturing overhead costs incurred $ 15,280 132,860 8,200 72,808 152,480 18, 280 $390,eee eBook Hint Print Other costs incurred: Purchases of raw materials (both direct and indirect) Direct labor cost $402,00e $ 62,08e Inventories: ow materials, beginníng Raw materials, ending Work in process, beginning Work in pracess, ending 20,200 $ 30,2e S 40,20e s 70,208 The company uses a predetermined overhead rate of $20 per machine-hour to apply overhead cost to machine-hours were used during the year jobs. A total of 19.900 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

Explanation / Answer

1) Overhead applied = 20*19900 = $398000

2) Schedule of cost of goods manufactured :

Direct material used Beginning raw material 20200 Raw material purchase 402000 Raw material available for use 422200 Less: Ending raw material -30200 Raw material used in production 392000 Less: Indirect material -35200 DIrect material used 356800 Direct labour 62000 Manufacturing overhead 398000 Total manufacturing cost 816800 Beginning work in process 40200 Total cost of work in process 857000 Less: Ending work in process -70200 Cost of goods manufactured 786800

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