What was the amount of underapplied or overapplied overhead

Assignment Help Accounting Basics

Reference no: EM13573420

WoodGrain Technology makes home office furniture from fine hardwoods. The company uses a job-order costing system and predetermined overhead rates to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Preparation Department is based on machine hours, and the rate in the Fabrication Department is based on direct labor-hours. At the beginning of the year, the company's management made the following estimates for the year:

	Department

	Preparation	Fabrication
Machine-hours	82,000	33,000
Direct labor-hours	32,000	59,600
Direct materials cost	$195,000	$205,000
Direct labor cost	$282,000	$512,000
Fixed manufacturing overhead cost	$229,600	$560,240
Variable manufacturing overhead per machine-hour	$2.80	-
Variable manufacturing overhead per direct labor-hour	-	$4.80

Job 127 was started on April 1 and completed on May 12. The company's cost records show the following information concerning the job:

	Department

	Preparation	Fabrication
Machine-hours	390	74
Direct labor-hours	80	134
Direct materials cost	$944	$1,180
Direct labor cost	$680	$1,010

Required:

1.	Compute the predetermined overhead rate used during the year in the Preparation Department. Compute the rate used in the Fabrication Department. (Round your answers to 2 decimal places. Omit the "$" sign in your response.)

	Predetermined overhead rate
Preparation Department	$	per MH
Fabrication Department	$	per DLH

2.	Compute the total overhead cost applied to Job 127. (Round "Predetermined overhead rate" to 2 decimal places, other intermediate calculations and final answers to the nearest dollar amount. Omit the "$" sign in your response.)

Total overhead cost

3-a.	What would be the total cost recorded for Job 127? (Round "Predetermined overhead rate" to 2 decimal places, other intermediate calculations and final answers to the nearest dollar amount. Omit the "$" sign in your response.)

	Department

	Preparation	Fabrication	Total
Direct materials	$	$	$
Direct labor
Manufacturing overhead

Total cost	$	$	$

3-b.	If the job contained 34 units, what would be the unit product cost? (Round "Predetermined overhead rate" and final answer to 2 decimal places and other intermediate calculations to the nearest dollar amount. Omit the "$" sign in your response.)

Unit product cost

4.	At the end of the year, the records of WoodGrain Technology revealed the following actual cost and operating data for all jobs worked on during the year:

	Department

	Preparation	Fabrication
Machine-hours	81,600	24,200
Direct labor-hours	25,000	60,000
Direct materials cost	$167,900	$418,000
Manufacturing overhead cost	$467,660	$816,400

What was the amount of underapplied or overapplied overhead in each department at the end of the year? (Round "Predetermined overhead rate" to 2 decimal places, other intermediate calculations and final answers to the nearest dollar amount. Input all amounts as positive values. Leave no cells blank - be certain to enter "0" wherever required. Select "None" for no effect (i.e., zero variance). Omit the "$" sign in your response.)


Preparation Department	(Click to select)NoneUnderapplied overheadOverapplied overhead	$
Fabrication Department	(Click to select)Overapplied overheadUnderapplied overheadNone	$

Reference no: EM13573420

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