Reference no: EM132911487

Question - S Company, which uses a job-costing system, began business on January 1, and applies manufacturing overhead on the basis of direct-labor cost. The following information relates to the first year of operations: · Budgeted direct labor and manufacturing overhead were anticipated to be P200,000 and P250,000, respectively.

Job nos. 1, 2, and 3 were begun during the year and had the following charges for direct material and direct labor:

Job # 1 Direct Materials ,Direct Labor P145,000, P35,000

Job# 2 Direct Materials ,Direct Labor 320,000, 65,000

Job# 3 Direct Materials, Direct Labor P 55,000, 80,000

Job nos. 1 and 2 were completed and sold on account to customers at a profit of 60% of cost.

Job no. 3 remained in production. · Actual manufacturing overhead by year-end totaled P233,000. Rock Star adjusts all under- and overapplied overhead to cost of goods sold.

Required -

a) Compute the company's predetermined overhead application rate.

b) Compute Rock Star's ending work-in-process inventory.

c) Determine Rock Star's sales revenue. d) Was manufacturing overhead under- or overapplied during 20x3? By how much?