Duggan Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are expected to total $338,580 for the year, and machine usage is estimated at 125,400 hours.
For the year, $361,548 of overhead costs are incurred and 132,400 hours are used.
(a) Compute the manufacturing overhead rate for the year. (Round answers to 2 decimal places, e.g. 1.25.)
Manufacturing overhead rate ————————- per machine hour
(b) What is the amount of under or over-applied overhead at December 31?
(c) Prepare the adjusting entry to assign the under or over-applied overhead for the year to cost of goods sold.
The ledger of Custer Company has the following work in process account.
5/1 Balance 4,280 5/31 Materials 6,400 5/31 Labor 3,200 5/31 Overhead 1,330
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5/31 Transferred out ? |
5/31 Balance ?
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Production records show that there were 570 units in the beginning inventory, 30% complete, 1,460 units started, and 1,510 units transferred out. The beginning work in process had materials cost of $2,610 and conversion costs of $1,670. The units in ending inventory were 40% complete. Materials are entered at the beginning of the painting process.
Instructions
(a) How many units are in process at May 31?
(b) What is the unit materials cost for May?
(c) What is the unit conversion cost for May?
(d) What is the total cost of units transferred out in May?
(e) What is the cost of the May 31 inventory?
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(b) Compute the overhead rates using the activity-based costing approach.
(c) Determine the difference in allocation between the two approaches.