i of the work you have done so far is correct, you may not have completed everyt
ID: 2395628 • Letter: I
Question
i of the work you have done so far is correct, you may not have completed everything 150 points Exercise 2-14 Computing Predetermined Overhead Rates and Job Costs ILO2-1, LO2-2, LO2-3, LO2-7 Mouony corporaton usengsstem with a poartwide oveiead rate bae machine hours. At the beginning of the year, the company made the following estimates Machine-hours required to support estimated production157,000 Foxed manufacturing overhead cost Variable manufacturing overhead cost per machine-hour S 440 654,000 Required: 1. Compute the predetermined overhead rate. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Answer is complete but not entirely correct. d s 8.56 MH 2. During the year, Job 400 was started and compieted. The following information was available with respect to this job Direct materials requisitioned Direct labor cost Machine-hours used $ 360 $ 270 32 Compute the total manufacturing cost assigned to Job 400 (Do not round intermediate calculations and round final answer to 2 decimal places.) Answer is complete and correct. Trotai manufacturing cost 903 92 3-a. During the year the company worked a total of 146,000 machine-hours on all jobs and incurred actual manufacturing overhead costs of $1,253,220. What is the amount of overhead for the year? (Use the overhead rate determined in requirement 1.) underapplied or overappledExplanation / Answer
Answer 1.
Total Manufacturing Overhead Cost = Variable Manufacturing Overhead Cost per machine-hour * Machine-hours required + Fixed Manufacturing Overhead Cost
Total Manufacturing Overhead Cost = $4.40 * 157,000 + $654,000
Total Manufacturing Overhead Cost = $1,344,800
Predetermined Overhead Rate = Total Manufacturing Overhead Cost / Machine-hours required
Predetermined Overhead Rate = $1,344,800 / 157,000
Predetermined Overhead Rate = $8.57
Answer 3-a.
Predetermined Overhead Rate = $8.57 per machine-hour
Total machine-hours = 146,000
Actual Manufacturing Overhead Costs = $1,253,220
Manufacturing Overhead Cost applied = Predetermined Overhead Rate * Total machine-hours
Manufacturing Overhead Cost applied = $8.57 * 146,000
Manufacturing Overhead Cost applied = $1,251,220
Underapplied Overhead Cost = Actual Manufacturing Overhead Costs - Manufacturing Overhead Cost applied
Underapplied Overhead Cost =$1,253,220 - $1,251,220
Underapplied Overhead Cost = $2,000
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