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Question - A company prepared its budget for the upcoming year. They use a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. The budget estimated that manufacturing overhead for the year would be $42,430 and direct labor-hours for the year were estimated at 20,000 hours.
In September Job #XYZ was completed. Materials costs on the job totaled $4,250 and labor costs totaled $1,500 at $10 per hour. The company logged 23,750 direct labor-hours for the year and incurred $49,850 in actual manufacturing overhead costs.
Job #XYZ contained 145 units. What would be the unit product cost on the completed job cost sheet?
What was the applied overhead amount for the year? Was overhead under or over applied?
Please show all calculations in the text box.
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