Sweeten Company had no jobs in progress at the beginning of March and no beginni
ID: 2335623 • Letter: S
Question
Sweeten Company had no jobs in progress at the beginning of March and no beginning inventories. It started only two jobs during March—Job P and Job Q. Job P was completed and sold by the end of March and Job Q was incomplete at the end of March. The company uses a plant-wide predetermined overhead rate based on direct labor-hours. The following additional information is available for the company as a whole and for Jobs P and Q (all data and questions relate to the month of March):
1) What is the company's predetermined overhead rate? (Round to 2 decimal places)
2) How much manufacturing overhead was applied to Job P and Job Q?
3) What is the direct labor hourly wage rate?
4) If Job P includes 33 units, what is its unit product cost?
5) What is the total amount of manufacturing cost assigned to Job Q as of the end of March (including applied overhead)?
6) What is the amount of under-applied or over-applied overhead?
7) Will your answer to question 6 increase or decrease un-adjusted cost of goods sold?
8) If Sweeten Company requisitioned $31,000 from raw materials inventory during March, then how much indirect materials cost would be included in Manufacturing Overhead Incurred?
9) If Sweeten Company’s labor time tickets totaled $68,600 for the month of March, then how much indirect labor cost would be included in Manufacturing Overhead Incurred?
10) Calculate the cost of goods sold using the direct method.
11) Calculate the cost of goods manufactured using the indirect method.
12) Calculate the cost of goods sold using the indirect method.
13)How would you revise your answer to question 11 if the company had beginning work in process inventory of $9,800?
14) How would you revise your answer to question 12 if the company had beginning finished goods inventory of $13,800?
15) Assume that Job P includes 33 units that each sell for $2,900 and that the company’s selling and administrative expenses in March were $10,500. Prepare an absorption costing income statement for March.
Job P Job Q Direct Materials $17,000 $9,800 Direct Labor Costs $49,300 $13,600 Actual Direct Labor-hours worked 2,900 800Explanation / Answer
Solution 1:
Predetermined overhead rate = Estimated manufacturing overhead / Estimated direct labor hours
= (15200 + 3800*$1.70) / 3800 = $5.70 per direct labor hour
Solution 2:
Solution 3:
Hourly wage rate of direct labor = Direct labor cost / Actual labor hour worked = $49,300 / 2900 = $17 per hour
Solution 4:
Solution 5:
Solution 6:
Total overhead applied = $16,530 + $4,560 = $21,090
Actual overhead incurred = $22,000
Underapplied overhead = $22,000 - $21,090 = $910
Solution 7:
Underapplied overhead increase the unadjusted cost of goods sold.
Solution 8:
Indirect material cost = Total material consumed - direct material = $31,000 - ($17,000 + $9,800) = $4,200
Note: I have answered more than required parts as per chegg policy, kindly post separate question for answer of remaining parts.
Computation of overhead applied to Job - Sweeten Company Particulars Job P Job Q Actual direct labor hours 2900 800 Predetermined overhead rate $5.70 $5.70 Overhead applied $16,530.00 $4,560.00Related Questions
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