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marysya [2.9K]
3 years ago
8

Please hep me solve this thank you!Tevebaugh Corporation is a manufacturer that uses job-order costing. The company closes out a

ny overapplied or underapplied overhead to Cost of Goods Sold at the end of the year. The company has supplied the following data for the just completed year:Beginning inventories: Finished goods $ 30,000 Estimated total manufacturing overhead at the beginning of the year $ 568,000 Estimated direct labor-hours at the beginning of the year 32,000 direct labor-hoursResults of operations:Raw materials (all direct) requisitioned for use in production $ 501,000 Direct labor cost $ 683,000 Actual direct labor-hours 33,000 direct labor-hoursManufacturing overhead: Indirect labor cost $ 176,000 Other manufacturing overhead costs incurred $ 420,000 Selling and administrative: Selling and administrative salaries $ 219,000 Other selling and administrative expenses $ 346,000 Cost of goods manufactured $ 1,567,000 Sales revenue $ 2,498,000 Cost of goods sold (unadjusted) $ 1,376,000 The net operating income is:Garrison 16e Rechecks 2017-08-28Multiple Choice$892,750$765,750$546,750$1,111,750
Business
1 answer:
jarptica [38.1K]3 years ago
4 0

Answer:

$546,750

Explanation:

Sales                  2,498,000

COGS                (1,376,000)

gross profit        1,  112,000

S&A salaries        (219,000)

other S&A           (346,000)

underapplied MO  (10,250) *

net income           536.750‬

*we need to compare the actual voerhead with the applied overhead:

<u>actual overhead:</u> 176,000 + 420,000 = 596,000

<u>applied overhead:</u>

overhead rate:

\frac{Cost\: Of \:Manufacturing \:Overhead}{Cost \:Driver}= Overhead \:Rate

568,000 / 32,000 = 17.75

33,000 x 17.75 = 585.750

      overhead

<u>debit              credit</u>

596,000    585,750

                    10,250 underapplied overhead

As the applied was lower it is underapplied we need to recognzie more cot thus, the net income decrease.

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