2. (6 points) Gonzalez, Inc. manufactures stereo speakers in two factories; one
ID: 2339526 • Letter: 2
Question
2. (6 points) Gonzalez, Inc. manufactures stereo speakers in two factories; one in Vandalia, Illinois and another in Merced, California. The Vandalia factory uses direct labor hours (DLHs) for its overhead rate and the Modesto factory uses machine-hours (MHs) for its overhead rate. Information related to both plants for last year is presented below: Vandalia factory Modesto factory S2,580,000 150,000 MHs Estimated amount of allocation base.. (a Actual amount of allocation base Applied manufacturing overhead.... $4,025,000 $35 per DLH(d) $4,100,000 ... 145,000 MHs S2,600,000 $4,200,000(e) Under or overapplied overhead (indicate the dollar amount and whether it is Required: Fill in the lettered blanks above. SHOW YOUR CALCULATIONS BELOW (For partial credit)!Explanation / Answer
working note:
a.estimated amount of allocation base =estimated manufacturing overhead / predetermined overhead rate
=>$4,025,000 / 35
=>115,000 MHs.
b.Actual amount of allocation base = applied manufacturing overhead / predetermined overhead rate
=>$4,200,000/35
=>120,000 MHs
c.overapplied manufacturing overhead = applied overhead - actual overhead
=>4,200,000-4,100,000
=>$100,000.
d.predetermined overhead rate = estimated manufacturing overhead / estimated amount of allocation base
=>$2,580,000 / 150,000 MHs
=>$17.20.per MH
e.Applied manufacturing overhead = actual amount of allocation base *predetermined overhead rate
=>145,000 * $17.20
=>$2,494,000.
f.under applied overhead = applied manufacturing overhead -actual manufacturing overhead
=>2,494,000 - 2,600,000
=>$106,000.
vandalia factory modesto factory estimated manufacturing overhead 4,025,000 2,580,000 estimated amount of allocation base (a)115,000 150,000 MHs predetermined overhead rate $35 per DLH (d)$17.20 actual amount of allocation base (b)120,000 MHs 145,000 MHs actual manufacturing overhead 4,100,000 2,600,000 applied manufacturing overhead 4,200,000 (e)2,494,000 under or over applied overhead (c)100,000 over (f)106,000 underRelated Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.