Question

The following cost data relate to the manufacturing activities of Chang Company during the just completed year:Manufacturing overhead 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 10,800Total actual manufacturing overhead costs incurred $ 402,000 Other costs incurred: Purchases of raw materials (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 overhead cost to jobs. The rate for the year was $20 per machine-hour. A total of 20,500 machine-hours was recorded for the year.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.

Answer 1

Answer:

1. overapplied overheads = applied overheads - actual overheads

                                          = (20*20500hrs) - 402 000

                                          =  410,000- 402,000

                                          = $8000

2. details             $

direct labor          68000

direct material  382200

factory overheads  410000

total cost                  860200

work in process  

opening                     40800

total cost                     860200

closing                    70800

finished goods  830200

Explanation:

raw material used  382200

opening                  20800

purchased          392200

closing                   30800