4. Brusveen Corporation applies manufacturing overhead to jobs on the basis of direct labor hours. The following information relates to Brusveen for last year: Estimated Actual
Direct labor hours…………………………… 15,000 14,800
Manufacturing overhead cost…………….. $300,000 $287,120
What was Brusveen’s underapplied or overapplied overhead for last year?
$4,000 underapplied
$8,880 underapplied
$8,880 overapplied
$9,000 underapplied
5. Linh Corporation applies manufacturing overhead to jobs on the basis of pounds of direct material used. Linh estimated 160,000 pounds of material usage and $200,000 of manufacturing overhead cost for the year. During the year, Linh actually used 150,000 pounds of material and incurred $171,000 of manufacturing overhead cost. What was Linh’s underapplied or overapplied overhead for the year?
$12,500 underapplied
$16,500 overapplied
$17,600 underapplied
$29,000 overapplied
6. Darrow Company uses a predetermined overhead rate based on direct labor hours to apply manufacturing overhead to jobs. Last year, the company worked 10,000 direct labor hours and incurred $80,000 of actual manufacturing overhead cost. If overhead was underapplied by $2,000, the predetermined overhead rate for the company for the year must have been:
$7.80
$8.00
$8.20
$8.40
Washtenaw Corporation uses a job order costing system. The following data are for last year:
Estimated direct labor hours……………………………. 12,000
Estimated manufacturing overhead costs…………… $39,000
Actual direct labor hours……………………………….. 11,000
Actual manufacturing overhead costs……………….. $37,000
Washtenaw applies overhead using a predetermined rate based on direct labor hours. What amount of overhead was applied to jobs last year?
$39,050
$42,600
$35,750
$36,960
9. The Silver Company uses a predetermined overhead rate to apply manufacturing overhead to jobs. The predetermined overhead rate is based on labor cost in Dept. A and on machine hours in Dept. B. At the beginning of the year, the company made the following estimates: Dept A Dept B
Direct labor costs……………………………….. $60,000 $40,000
Manufacturing overhead……………………….. $90,000 $45,000
Direct labor hours………………………………. 6,000 9,000
Machine hours………………………………….. 2,000 15,000
What predetermined overhead rates would be used in Dept A and Dept B, respectively?
67% and $3.00
150% and $5.00
150% and $3.00
67% and $5.00
11. Wayne Company’s beginning and ending inventories for the month of June were as follows:
June 1 June 30
Work in process……………………………. $145,000 $171,000
Finished goods…………………………….. $ 85,000 $ 78,000
Production data for the month follow:
Direct labor cost incurred…………………………. $200,000
Direct labor hours…………………………………… $ 25,000
Actual manufacturing overhead cost incurred… $132,000
Direct materials…………………………………….. $170,000
Wayne applies manufacturing overhead cost to jobs based on direct labor hours, and the predetermined rate is $5.75 per direct labor hour. The company does not close underapplied or overapplied manufacturing overhead to Cost of Goods Sold until the end of the year. What is the amount of cost of goods manufactured?
$508,750
$502,000
$585,000
$487,750
13. Baka Corporation applies manufacturing overhead on the basis of direct labor hours. At the beginning of the most recent year, the company based its predetermined overhead rate on total estimated overhead of $239,700 and 4,700 estimated direct labor hours. Actual manufacturing overhead for the year amounted to $242,000 and actual direct labor hours were 4,600.
The predetermined overhead rate for the year was closest to:
$52.61
$49.91
$51.00
$51.49
15. Toan Inc. uses a job order costing system in which any underapplied or overapplied overhead is closed to cost of goods sold at the end of the month. In September the company completed job S80M that consisted of 23,000 units of one of the company’s standard products. No other jobs were in process during the month. The job cost sheet for job S80M shows the following costs:
Begininning balance…………………………………….. $ 66,700
Direct materials………………………………………….. $494,000
Direct labor cost…………………………………………. $158,700
Manufacturing overhead cost applied……………….. $269,100
During the month, the actual manufacturing overhead cost incurred was $270,020 and 3,000 completed units from job S80M were sold. No other products were sold during the month.
The unit product cost for job S80M is closest to:
$31.30
$43.00
$329.97
$329.67
16. An effective ERM program would include coverage of broad risk categories, including:
legal and regulatory risks
risk of losses due to natural disasters
risk of IT operations failures
all of the above