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Category > Accounting Posted 17 Aug 2017 My Price 9.00

Agassi Company

P2-4A Agassi Company uses a job order cost system in each of its three manufacturing departments. Manufacturing overhead is applied to jobs on the basis of direct labor cost in Department D, direct labor hours in Department E, and machine hours in Department K.

In establishing the predetermined overhead rates for 2014, the following estimates were made for the year.

 

Department

 

D

 

E

 

K

Manufacturing overhead

$1,200,000

 

$1,500,000

 

$900,000

Direct labor costs

$1,500,000

 

$1,250,000

 

$450,000

Direct labor hours

100,000

 

125,000

 

40,000

Machine hours

400,000

 

500,000

 

120,000

During January, the job cost sheets showed the following costs and production  data.

Department

 

D

 

E

 

K

Direct materials used

$140,000

 

$126,000

 

$78,000

Direct labor costs

$120,000

 

$110,000

 

$37,500

Manufacturing overhead incurred

$  99,000

 

$124,000

 

$79,000

Direct labor hours

8,000

 

11,000

 

3,500

Machine hours

34,000

 

45,000

 

10,400


Instructions

(a)  Compute the predetermined overhead rate for each department.

(b)  Compute the total manufacturing costs assigned to jobs in January in each department.

(c)   Compute the under- or overapplied overhead for each department at January 31.

Answers

Maurice Tutor
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Status NEW Posted 17 Aug 2017 04:08 PM My Price 9.00

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