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MBA, Ph.D in Management
Harvard university
Feb-1997 - Aug-2003
Professor
Strayer University
Jan-2007 - Present
11. Exercise 2-14 Computing Predetermined Overhead Rates and Job Costs [LO2-1, LO2-2, LO2-3, LO2-7]
Moody Corporation uses a job-order costing system with a plantwide overhead rate based on machine-hours. At the beginning of the year, the company made the following estimates:
Machine-hours required to support estimated production 155,000 Fixed manufacturing overhead cost$654,000 Variable manufacturing overhead cost per machine-hour$4.60
Required:1.Compute the predetermined overhead rate. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
2.During the year, Job 400 was started and completed. The following information was available with respect to this job:
Direct materials requisitioned$360 Direct labor cost$260 Machine-hours used 39
Compute the total manufacturing cost assigned to Job 400. (Do not round intermediate calculations and round final answer to 2 decimal places.)
During the year the company worked a total of 145,200 machine-hours on all jobs and incurred actual manufacturing overhead costs of $1,288,164. What is the amount of underapplied or overapplied overhead for the year? (Use the overhead rate determined in requirement 1.)
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